Robotic Process Automation for the Banks

Why every third company already implemented or is implementing RPA

It goes without saying that every major bank or other finance company strives to reduce its operational costs while simultaneously remaining compliant, drive greater efficiency and productivity.

Robotic Process Automation or RPA (also called smart or intelligent automation) is a hot commodity for enterprises and a much talked about topic for every company, which strives to take first step towards digital transformation. Introducing RPA means allowing technology to drive higher efficiency in a shorter amount of time at a reduced cost. All that, while your employees focus on other tasks and your customers benefit from a better experience.

Banks need to stay competitive and in step with modernization and customer’s needs, especially since Fin-tech competitors are entering the market, eroding revenue and margins from mainstream banks.

According to Gartner, Robotic Process Automation (RPA) is the fastest-growing segment in the worldwide enterprise software market. By the end of 2020, Gartner predicts that RPA services will be valued at £5.98 billion.

The ideal candidates for RPA:

• High volume of processes
• Repetitive tasks
• Manual Data entry
• Multiple Legacy Systems
• Rule-based and structured process

RPA use cases in banking

Banks can use RPA to follow one or all of three main goals:

• Enhance customer experience
• Reduce costs
• Stay compliant with the internal and external regulators

The idea of implementing RPA in banking went from automatic simple tasks to entire processes. Companies that have implemented RPA now benefit from 25% to 50% cost savings over traditional manual labor.

RPA Use Cases in Banks

Below is a list of use cases any bank can benefit from:

Customer onboarding

Gathering vital information on your new-coming customers is often a very long and tedious task. Filling out paperwork manually and Know Your Customer (KYC) documents take time and need to be manually verified.

RPA can join forces with an optical character recognition tool (OCR) and automatically capture the essential data from the KYC documents. It is later matched against the data the customer provided in the onboarding form.

Bank reconciliation process

The often-tedious task of reconciling the balances of the bank’s accounting records to the corresponding information on a bank statement can be easily automated as it is heavily predefined.

RPA allows for automatic login to multiple bank accounts, automatic login to ERP systems, and extraction of data for general ledgers, including balance sheet, P&L. The biggest benefit, however, is the preparation of a bank reconciliation statement in a predefined format.

Know your customer (KYC) and Anti-money laundering (AML)

Both processes, KYC and AML are very data-intensive, rule-based and structured in a form, which makes them most suitable for Robotic process automation. Bank employees continuously make efforts to verify the identity, suitability and risks involved with maintaining a business relationship with every customer and on the other hand, prevent any suspicious transactions from happening. RPA can significantly cut costs and time, while practically eliminating the chance for error (near zero).

Account receivables processing

Another procedure that requires attention on a daily basis is setting up credit, generating invoices, maintaining records of payments due and payments received, and performing accounting functions.

Robots can help you automate credit approvals and maintain a customer file, route and process customer orders and even send late payment notifications to a specific customer, all drastically saving FTEs.

Mortgage Lending

RPA cuts the time spent for mortgage lending processes by 50%. It allows for easy automation of different tasks and connects various applications, starting with loan initiation, document processing, financial comparisons, and quality control. Faster process results in increased customer satisfaction and better productivity of your employees.

Compliance

Banks usually have a significant number of information systems that are in many cases independent of each other and require significant manual work to move data from one system to another. Regulators require full transparency and traceability of the process that cannot be achieved by manual processes and require from banks to automate dozens of processes to fulfill the regulator’s requirements.