Intelligent Automation in the Banking Sector

Volume, Velocity, and Variety of data are the key drivers of?automation ?in the financial services industry. Many banks are struggling with legacy manual business processes which are hampering their growth. In the post covid era everything is shifting to a digital-first approach. In addition, businesses want to remain lean to save costs. Automation driven by a combination of robots and AI can augment human functions and enable banks to be more competitive.

Digital-first fintechs are disrupting the financial sector. Fintech funding exceeded $130 billion in 2021 according to Business insider.

Fintechs are taking away some key financial solutions that banks traditionally offered. Automation is one of the keys that have unlocked exponential growth for fintechs.

#Mpesa by Safaricom is a good example of a fintech that has surpassed banks in key financial offerings. In Kenya, a massive portion of the GDP is moved on mpesa. MPesa has become synonymous with money. Many Kenyans would rather leave their wallets at home than their phones.

One typical example is account opening for fintech's versus banks. Banks KYC and physical checks can take you anywhere from 24 hours to 7 days (Case for Kenyan Banks) for account opening. On the other hand, fintechs take you less than 10 minutes to open an account and start transacting. Plus the whole process is self-service and you do not need to move an inch.

Accounting functions present one of the biggest opportunities for automation in Banks. More than 70% of accounting functions can be automated and produce a positive ROI for the bank. Automation helps banks and accounting departments automate repetitive manual processes, allowing the employees to focus on more critical and strategic tasks.

Below is an extract from a McKinsey report showing automation potential in the accounting finance function.

Automation use cases in Banks

1. Report generation
2. Accounts payable
3. Accounts Reconciliation
4. Mortgage processing
5. Know your customer (KYC)
6. Customer Service
7. Compliance
8. Credit Card Processing
9. Fraud Detection
10. Account Closure

Benefits of RPA (Robotics Process Automation) in banking and finance

The global RPA market is projected to surpass $3 billion and is expected to rise at a CAGR of 32.8% from 2021 to 2028. According to Gartner,?80% of leaders in the financial sector ?are already using some form of automation for various purposes. Here are some of the most prominent benefits of financial process automation:

1. No New IT Infrastructure costs -?Implementing automation in finance and banking doesn’t require significant changes to the infrastructure. It is a layer that sits on top of the existing banking applications.
2. Saves time -?When a robotic application is set up, it can reduce the time needed to perform specific tasks?up to 90% .
3. Cuts down expenses.?Deloitte estimates a?30% cost reduction ?as a result of automation deployment. Accenture gives a more optimistic forecast and suggests an?80% cost decrease ?with robotics in finance for certain tasks.
4. Improve Processes?- This allows you to scale operations seamlessly when needed. Robots can work longer hours and don’t need to take breaks. They can manage increasing request volumes during peak hours.
5. Increases human employee efficiency -?Studies show that robots can work up to?five times faster ?than humans on specific tasks. As a result, people do not need to waste time and energy on routine duties and can concentrate on something more fulfilling, increasing the overall employee well-being and job satisfaction.
6. Reduces human error.?Financial automation has a systematic way of handling its allocated tasks. It will increase output quality by eliminating errors that regular employees may make due to human nature, such as not paying close attention to the task at hand.
7. Minimizes IT department interference.?Employees can be trained to manage their own robotic automation assistants.

At?Techno Brain Group ?we pride ourselves on helping both large and small organizations automate their processes and remain more competitive in the new digital landscape.

Need help with your automation journey? Feel free to get InTouch

#RPA #AI #ML #NLU #BFSI #telco #banking #banks #fintech #financialsector #insurance #manufacturing #sacco #automation #intelligentautomation #cloud #saas #UiPath #powerautomate #automationanywhere #workfusion #blueprism