Robotic Process Automation in banking07/08/2022 0 By indiafreenotes
RPA is a technology used to automate manual business procedures to allow banks to stay competitive in a growing market. An RPA banking will provide customers with the ability to automatically process payments, deposits, withdrawals, and other banking transactions without the need for manual intervention. Banks are very quickly able to see an ROI from RPA.
RPA takes full form in banking as technology continues to grow. More and more people are using digital banking, cryptocurrency, and mobile payments. These are only some examples of RPA in banking. These Digital transformation projects remain at the top of the list for many banks and will continue to drive the overall technological growth of the banking process.
Intelligent Automation works in banking:
- IA enables banks to automate complex end-to-end processes.
- These processes typically involve the use of structured and unstructured data.
- Thanks to AI and Machine Learning (ML), IA systems are able to communicate using human languages, classifying, and recognizing ‘sentiment’.
- This understanding of sentiment or language enables IA to operate in a completely automated fashion, even automating workflow steps that would have previously required human intervention.
Banks deal with multiple queries every day ranging from account information to application status to balance information. It becomes difficult for banks to respond to queries with a low turnaround time.
RPA can automate such rule-based processes to respond to queries in real-time and reduce turnaround time to seconds, freeing up human resources for more critical tasks
With the help of artificial intelligence, RPA can also resolve queries that need decision-making. By using NLP, Chatbot Automation enables bots to understand the natural language of chatting with customers and respond like humans.
Credit Card Processing
Traditional credit card application processing used to take weeks to validate the customer information and approve credit cards. The long waiting period was dissatisfaction to customers and cost to banks. However, with the help of RPA, banks now can process the application within hours. RPA can talk to multiple systems simultaneously to validate the information like required documents, background checks, credit checks and take the decision based on rules to approve or disapprove the application.
Accounts payable is a simple but monotonous process in the banking system. It requires extracting vendor information, validating it, and then processing the payment. This does not require any intelligence making it the perfect case for RPA.
Robotic Process Automation with the help of optical character recognition (OCR) solutions can solve this problem. OCR can read the vendor information from the digital copy physical form and provide information to the RPA system. RPA will validate the information with the information in the system and process the payment. If any error occurs, RPA can notify the executive for resolution.
The banks must keep the general ledger updated with information like financial statements, revenue, assets, liabilities, expenses, and revenue which is used to prepare financial statements. Financial statements are the public documents that are then accessed by the public, stakeholders, and media. Considering the amount of detailed information in the statement, errors in the report can very badly affect the bank’s image.
To create the statement, the bank needs to update information from the multiple legacy systems as these systems cannot integrate, verify it and make sure that the general ledger is prepared with no errors. With this amount of data from multiple systems, it is bound to have errors. Here comes RPA to the rescue. RPA is independent of the technology and can integrate data from multiple legacy systems to present in the required format even if the data in the systems are not in the same format. This reduces the huge amount of data handling and time.
Like all other public companies, banks need to prepare reports and present them to their stakeholders to show their performance. Considering the importance of the report, there is no chance for the bank to make an error.
While RPA systems provide data in multiple formats, they can create reports by auto-filling the available report format to create reports without errors and minimum time
Account Closure Process
With such a huge number of customers, it is supposed to get some account closure requests monthly. There can be various reasons for the account closures and one of them is when a client has failed to provide the mandatory documents.
With Robotic Process Automation, it is easy to track such accounts, send automated notifications, and schedule calls for the required document submissions. RPA can also help banks to close accounts in exceptional scenarios like customers failing to provide KYC documents.
With the introduction of digital systems, one of the major concerns of banks is fraud. It is really difficult for banks to track all the transactions to flag the possible fraud transaction. Whereas RPA can track the transactions and raise the flag for possible fraud transaction patterns in real-time reducing the delay in response. In certain cases, RPA can prevent fraud by blocking accounts and stopping transactions.
Know Your Customer (KYC) is a mandatory process for banks for every customer. This process includes 500 to 1000+ FTEs to perform necessary checks on the customers. According to Thomson Reuters, banks spend more than $384 million per year on KYC process compliance.
Considering the cost of the manual process, banks have started using RPA to validate customer data. With increased accuracy, banks no longer have to worry about the FTEs and the process can be completed with minimal errors and staff.