Top 10 Use Cases & Examples of RPA in Banking Industry 2022

automation in banking examples

There are advantages since transactions and compliance are completed quickly and efficiently. For example, ATMs (Automated Teller Machines) allow you to make quick cash deposits and withdrawals. The digital world has a lot to teach banks, and they must become really agile. Surprisingly, banks have been encouraged for years to go beyond their business in the ability to adjust to a digital environment where the majority of activities are conducted online or via smartphone.

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Itransition helps financial institutions drive business growth with a wide range of banking software solutions. Robotic process automation can match the output of hundreds of employees, which can end up saving the bank considerable time, resources and money when problem-solving or doing everyday administration. With digitization, concerns about fraud and terrorist activities in banks has increased.

Top Use Cases for Banking Automation

The manual process, which took 10 minutes per request, was automated and reduced to a few seconds of turnaround, thanks to RPA bots. Trade finance involves multiple international parties coordinating and ensuring the delivery of goods and payments. Banks and companies communicate through letters of credit (LC), bank guarantees (BG), and other documents that need to be processed. RPA bots can simplify data transfer between systems as loan processing includes input from multiple systems. Explore the top 10 use cases of robotic process automation for various industries. Robotic process automation transforms business processes across multiple industries and business functions.

Community banks were required to upload huge amounts of documentation and lots of applications for PPP loans to the Small Business Association (SBA) loan system. Lots of participating financial institutions used RPA technology to replicate the information entry process performed by humans, eliminating manual data entry. When banks offload their more straightforward tasks to automated technology, they can use their extra financial and human resources to expand into new working areas. Departments like innovation and marketing can develop ground-breaking new ways to do banking when the institution is not stuck in a rut of routine transactions every day. Your bank can spend more time expanding into other markets, designing more efficient solutions, and running more comprehensive studies on customer experience and how to improve it.

Report Automation

When deciding on your RPA adoption approach, you’ll face the choice between ready-made solutions and custom RPA software development. The cost of maintaining compliance can total up to $10,000 on average for large firms according to the Competitive Enterprise Institute. Most banks perform KYC (Know Your Customer) by manually verifying customer details. The enterprises that drive this change will be better situated than those who adapt it reflexively.

automation in banking examples

Cem’s work in Hypatos was covered by leading technology publications like TechCrunch and Business Insider. He graduated from Bogazici University as a computer engineer and holds an MBA from Columbia Business School. For instance, a UK-based bank9 leveraged RPA to automate 10 processes including direct debit cancellation, account closures, CHAPS, payments, foreign payments, audit reports, internet applications, and Card and Pin Pulls. In this case, the audit process was conducted in one minute, versus 6-7 hours manually. For instance, a top 30 US bank7 leveraged RPA to automate mortgage processes, such as document order, data entry, and data verification. An understanding of bank accounts and services is essential to understand the function of automation in banking.

IA represents a way to achieve these objectives, by automating tasks and allowing more emphasis on high-value activities. According to a recent poll performed by Thomson Reuters, the cost of KYC compliance and client due diligence can be high, ranging from US$52 million to US$384 million per year (for a bank). Automation not only eliminates manual errors but also saves time and work for the employees. This is just one example of how automation in financial services is enhancing customer experience (CX).

automation in banking examples

It‘s a challenging task for banks to handle such voluminous data and compile it into financial statements without any errors. With the help of RPA, banks can collect, update, and validate large amounts of information from different systems faster and with less likelihood of errors. Staff can use RPA tools to collect information and analyze various transactions against specific validation rules through Natural Language Processing (NLP). If RPA bots find any suspicious transactions, they can quickly flag them and reach out to compliance officers to handle the case. This type of automated proactive vigilance can help prevent financial institutions from facing financial losses and legal problems.

Robotic process automation for banks: the solution to streamlining operational management

Yet, they may or ready-to-use automation scenarios for some of the business apps your company already uses. Intelligent process automation demands more than the simple rule-based systems of RPA. You can think of RPA as “doing” tasks, while AI and ML encompass more of the “thinking” and «learning,» respectively. They allow developers and even non-technical staff to create applications through visual interfaces, instead of writing extensive code. In banking, low-code platforms can be used to build customer-facing applications, internal tools, and to automate complex workflows. These platforms speed up development time, reduce the need for specialized coding skills, and enable rapid iteration and adaptation of applications.

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”The benefits of RPA are materialized in different kinds of reconciling and confirmation processes, where information is moved from one place to another or data is reconciled between two different systems. As a result, it’s not enough for banks to only be available when and where customers require these organizations. Banks also need to ensure data safety, customized solutions and the intimacy and satisfaction of an in-person meeting on every channel online. Banks can personalize customer service by creating a more human-like experience through intelligent chatbots that will make customers feel more valued and appreciated. By using intelligent automation, a bank is able to get a more accurate automated payment system. Intelligent systems are able to calculate, send notifications, and a lot more.

First, it is crucial to identify the appropriate use cases such as repeatable and structured processes then prioritizing these based on alignment with business objectives. Consider automating both ingoing and outgoing payments so that human operators can spend more time on strategic tasks. Plus, several processes around payment issue investigations can also be automated to improve processing speeds.

automation in banking examples

This RPA-induced documentation and data collection leads to standardization, which is the fundamental prerequisite for going fully digital. Automated bank workflow management is the way forward for progressive banking institutions looking to build strong customer relationships. Over the last few years, banks have made foundational investments in data lakes, process excellence and customer journeys.

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Fast-forward to 2020, and banks are now viewed under the same lens as customer-facing organizations like movie theatres, restaurants and hotels. But my point is that advanced technology, customer demand and fintech disruptions have all dramatically changed what constitutes banking and how digital customers expect it to be. It is no great surprise to learn that finance and banking industry is one of the most heavily digitized industries in the world. In fact, it is estimated that around 85% of financial transactions are conducted via computer, tablet, or smartphone.

  • Accordingly, increasing business efficiency and reducing operational costs while maintaining maximum security levels as major challenges, banks and finance companies are inviting digital solutions.
  • Banks and their customers will benefit by utilizing automation for the banking and financial services sector.
  • In Canada, banks need to ensure they are complying with the statutes of the Proceeds of Crime (Money Laundering) and Terrorist Financing Act, 2000.
  • An Accenture study found that banking executives now expect that AI-based technologies will not only transform their industry, but will also add net gains in jobs.

You can read more about their story here, but we will also discuss the case in this text. Discover and understand which processes can be quickly automated and how to use new tech, such as chatbots, to improve customer visualization and productivity and reduce human errors. Develop a robust business intelligence infrastructure, achieve data integrity and a 360-view of the customer. Accordingly, increasing business efficiency and reducing operational costs while maintaining maximum security levels as major challenges, banks and finance companies are inviting digital solutions. AI and Robotic Process Automation (RPA) enabled banking apps have become an effective and powerful solution to automate time-consuming tasks and streamline entire procedures. This statistic is especially relevant for the banking and financial services industry, which are one of the most data-driven sectors of the economy today.

  • Businesses can benefit from document capture technologies, such as OCR, that are integrated with RPA, to automate the processing of paper-based forms.
  • For example, having one ATM machine could simplify withdrawals and deposits by ten bank workers at the counter.
  • Few primary manual activities include data extraction from applications, verification against different identity documents, and creditworthiness evaluation.
  • Stone Coast Fund Services, a leading hedge fund administrator is using process automation to ensure compliance for its large cash transfers process.
  • RPA can bring all relevant customer service documents or account information to a single screen to allow client verification.

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