Quadrion > Banking > Building the Case for Business Process Automation in Banking Operations

The customer’s digital-first mindset is driving banking businesses to extend technology adoption across the board. The rising demand from customers for online access and superior user experience is compelling banks to enhance customer facing interfaces and services. Consequently, there is a heightened urgency in upgrading their backend processes also through automation.

Bank goals have now expanded to include speedier services, improved compliance and delivering a better customer experience in addition to cost savings, enhanced productivity, and efficiency improvements.

The rising use of bots is also offering alternatives to human customer care agents who were often overwhelmed by the large volumes of requests. Automation can manage significantly greater workloads. With clearly defined processes chatbots can handle multiple requests, retrieve information from multiple digital platforms and verify and validate information.

Enterprises across the banking, financial services, and insurance (BFSI) sector are therefore keen to deploy RPA and benefit from speedy, clear internal systems besides frictionless flow of communication and services to customers that elevate their experience.

According to Grand View Research, the market size for robotic process automation in BFSI market size is expected to reach USD 1123.0 million by 2025
Areas for automation within banking
Loan-related activities

These form a large chunk of banking operations. Each stage is a process and fortunately, each of these processes, receiving a loan application, verification, validation, review, approval, disbursement, and tracking can be automated.

Given the volume and repetitive nature of loan processing, it is among the key areas for application of automation.

  • Loan processing: Creating and using a digital form allows the capture of specific information and direct upload into systems. Built-in verification and validation processes to check for authenticity further eases the challenges of the process. Among the biggest advantages is the creation of an accurate audit trail which is so critical to money transactions.
  • Loan forgiveness: Governments launch programs to encourage certain economic sections through loan forgiveness. For instance, during the pandemic, the US federal government initiated the Paycheck Protection Program (PPP) to help businesses take loans to continue operations and keep their workforce employed. Automation of such initiatives helps launch and implement programs within no time, so the benefits reach the beneficiaries at the earliest.
  • Loan modification: The natural ups and downs in the economy lead to changes in interest rates and repayment schedules. Automated processes allow easy updates that make the process clear, unambiguous, and current. 
Bank transactions
  • ACH stop payment processing: Automated clearing house (ACH) customer requests to stop payment or reverse ACH can be easily dealt with in automated solutions. These also ensure security and tracking of transactions.
  • Account opening: With the immediate identification and throwing up of data transcription errors, automated processes contribute to improving the quality of data collected and recorded.
  • Mortgage banking: Loan initiation, document processing, financial comparisons and quality control is enhanced by automation. It also removes the burden of manual work by bank officials.
  • Automatic Report generation: Generating suspicious activity reports (SAR)is a regular activity. RPA enhanced with Natural Language processing goes one step ahead to replace the conventional manual entries by compliance officers with bots scanning compliance documents to extract and file SAR automatically.
  • Customer Onboarding: Manual verification has been a large part of the customer onboarding process given the regulatory requirements around KYC norms. Using a combination of OCR and automation, the whole process can now be streamlined into a simple process with little to no human intervention.
Control and Compliance
  • Debit card fraud processing: Time is of the essence when dealing with card frauds. Action needs to be taken promptly. Digital forms and electronic routing help quicker action, review, and resolution in case of fraud or dispute.
  • Regulation D violation letter processing: Setting automated triggers to flag or warn instances of Frequent withdrawals or transfer tending toward the limit helps account holders and banks alike in ensuring compliance and control.
  • Identification verification (KYC) : The Know Your Customer (KYC) checks require identity checks across multiple parameters to avoid risky associations. At the same time, the process needs to be quick and not overly intrusive as this can alienate customers. Automation of compliance checks make it speedy, definite, and reliable.
  • Anti-money laundering (AML): The nature of scrutiny of these activities makes them ideal candidates for processes that minimize human intervention. The speed, accuracy and even the confidentiality that automated processes provide is unmatched and especially relevant in sensitive data collection activities such as KYC and AML documentation. 

Automation of banking processes is a win-win situation. Besides enhancing the accuracy, speed and streamlining of process, customers too get to access exceptional levels of services leading to enhanced customer experience. Banking activities that involve multiple data captures stages, verification, validation and ultimately approval and highly considered time consuming can be executed in record time.

With an automated system there is continuous flow, high level of accuracy and human intervention is limited to crucial decision-making activities. The leveraging of RPA, bot and process automation enhances the quality, speed, accuracy and compliance across all functions and operations with traceability. For customers too, the customer experience is enhanced and makes services accessible, available, and easy

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