Robotic Process Automation in Finance: How Will It Transform the Financial Landscape? | chaincode consulting

In today's digital age, the conventional banking sector faces competition from Fintech and virtual banking solutions. Banks and financial institutions must stay competitive by offering outstanding services.
Moreover, the banks are struggling to cut costs and improve productivity. Besides, customers today look for personalized, simplified, and fast financial services. Therefore, financial firms are burdened with bringing efficiency and accuracy to their processes. However, banks do not have the skilled resources or employees to optimize their services and meet the demands of the changing world.
So, how can banks boost their productivity?
The solution lies in the advanced automation brought by RPA technology. Robotic Automation Process aka RPA in banking automates daily routine tasks. Financial institutions can implement RPA to automate basic tasks like extracting and merging data, filling forms, data formatting, writing databases, and more. RPA in finance is also helping banks offer 24*7 customer support for essential services.
With intelligent bots, RPA aims to streamline financial operations and maximize efficiency. According to McKinsey & Company, RPA can efficiently automate 42% of financial activities.
Today, over 81% of banking executives are looking to adopt technology to boost the efficiency of their firms. In 2020, the value of the global RPA market was $1.57 billion. Observing the mass adoption of RPA in finance, its market will grow at 32.8% CAGR.
In this blog, we will understand the potential of RPA in banking. We will also explore its benefits and financial process automation use cases.

What is Robotic Process Automation?
Robotic process automation uses attended and unattended bots to automate routine tasks. Smart bots augment human behaviour to carry out repetitive tasks.
Robotic process automation is build using Artificial Intelligence, Machine Learning, Virtual Assistance and other sophisticated technologies.
You can understand RPA as an intelligent virtual workforce that does its allotted work without human intervention.
For instance, RPA bots can act as efficient customer assistance. They can resolve or answer customers' queries instantly with the help of pre-fed data.
RPA in businesses is helping to automate the following activities:
• Data entry
• Data processing
• Hiring & onboarding employees
• Payroll management
• Virtual help desk
• Customer Assistance
According to a McKinsey report, up to 97% of business revenue management functions can be automated. The research also shows that robotic automation has the potential to raise global productivity growth by 0.8% to 1.4% annually.

Robotic Process Automation In Finance
Robotic Process Automation boosts efficiency for banks & finance firms by minimizing manual work, enhancing compliance, reducing risks, and improving the customer experience.
But how?
Robotic process automation in finance and banking institutions are implemented in two ways. They are:
• Install desktop and end-user software tools
• Build an artificial intelligence workforce & virtual assistants
What problems do banks face? How can RPA resolve them?
Firstly, banks deal with numbers and crucial data. One slight mistake can lead to huge repercussions. RPA bots can automate data entry and management processes bringing efficiency and accuracy.
Secondly, banks spent millions of dollars on operating costs. A part of the operating cost goes towards compliance and fines. Financial institutions have spent over $321 billion in compliance operations and fines. Banks pay around 10% to 15% on compliance costs.
Moreover, increasing operating costs and regulatory fines, combined with strict regulations, slow down processes and negatively impact the customer experience.
RPA offers better compliance management and cuts operational costs by automating auditing, accounting, financial planning and analytics.
To sum up, RPA in banking streamlines repetitive tasks and boosts productivity by providing real-time customer engagement and utilizing the advantages of robots.

8 Benefits of Robotic Process Automation In Finance
Though there are several benefits of RPA in banking, we have mentioned some prominent ones here.
1. High Scalability
RPA robots are highly scalable, enabling you to handle large volumes during busy periods by adding more robots and quickly responding to any situation. It frees up employees to focus on innovation for business growth.
2. Improved Operational Efficiency
Properly implemented RPA can make banking processes faster, more productive, and more efficient.
3. Cost Savings
Cost-saving is critical in the banking industry, and RPA can save up to 25-50% in processing time and costs.
4. Risk Management and Compliance
RPA creates full audit trails for each process, reducing business risk and ensuring compliance.
5. Availability
RPA robots work 24/7 to complete assigned tasks, reducing manual errors and delivering accurate results at a low cost.
6. Low Infrastructure Costs
RPA in financial services does not require significant infrastructure changes, thanks to UI automation capabilities. Cloud-based RPA further reduces hardware and maintenance costs.
Deloitte agrees that robotic automation in finance can reduce costs by 30%. Accenturesuggests that, in some areas, automation can reduce operational costs by 80%.
7. Fast Implementation
RPA tools offer drag-and-drop technology for easy implementation and maintenance of automation workflows with minimal coding requirements. Research into the effects of automation in banking shows that it can reduce time by up to 90%.
8. Legacy Data for Business Growth
RPA implementation enables banks and financial services to use legacy and new data to bridge process gaps, creating faster, better reports for business growth.

RPA Uses Cases in Finance
The COO of Standard Chartered Bank, Zuzar Tinwalla, says, "All repetitive operational processes which are outside the core banking platform and are performed through manual activity are ideal candidates for RPA deployment."
We will look at some significant use cases of Robotic process automation in the finance and banking sector.
Report Generation
Banks and finance firms regularly produce compliance reports in the form of Suspicious Activity Reports (SARs). Traditionally, compliance officers manually read all reports and fill in SAR forms, making it a tedious task.
RPA with natural language generation simplifies this process by reading reports, extracting information, and filing SARs. It reduces operational costs and saves time.
Onboarding Customers
Banking customer onboarding is a long, labour-intensive process due to the manual verification of multiple documents. RPA automates this by capturing data from KYC documents using OCR and matching it against customer information.
If there are no discrepancies, the data is automatically entered into the customer management portal, reducing manual errors and saving time.
KYC and AML
KYC is a data-intensive and time-consuming task that consumes approximately 1000 full time hours. Several reports show that banks are spending over $384 million annually to process KYC in a compliant manner.
In addition to spending millions, banks have to incur a loss of $54 million. Moreover, the existing KYC processing system is inefficient. But how?
Firstly, 10% of the daily alerts are false. Secondly, its time taking as 25% of KYC verification needs to be reviewed by level two senior analysts.
By automating manual processes and catching suspicious transactions, RPA saves time and cost compared to traditional banking solutions.
Account Opening
RPA streamlines the account opening process, making it quicker, more accurate, and error-free.
By eliminating transcription errors between the core banking system and new account opening requests, RPA enhances data quality and reduces TAT while maintaining operational accuracy and cost savings.
Mortgage Lending
Mortgage lending is process-driven, making it suitable for RPA automation.
RPA handles tasks in the lending process, including loan initiation, document processing, financial comparisons, and quality control. Thus, resulting in faster loan approval and increased customer satisfaction. It also frees employees from manual tasks for higher productivity.
Loan Processing
Loan processing is a slow, labour-intensive process. RPA accelerates it, bringing processing time down to a record 10-15 minutes.
According to The Mortgage Reports, robotic process automation in banking can reduce loan processing time by 80%.
For instance, Radius Financial Group was able to cut 70% of the loan processing costs. With RPA, Radius was able to generate 30% more loan revenue from the rest of the industry during the covid pandemic.

Accounting & Financial Institutions Using Robotic Automation In Finance
Global insurer Zurich witnessed a 50% cost reduction in its processes by implementing RPA. Zurich was able to free up to 40% of its underwriter processes through robotic automation. Therefore, it allowed them to devote their time and resources towards high value and complex tasks.
OCBC, a Singaporean Bank, was able to bring the time taken to re-price home loans from 45 minutes to 1 minute. The bot verifies customers' eligibility to re-price home loans, terms & conditions, suggest better loan options, and even writes a recommendation email.
Sumitomo Mitsui, a Japanese financial institution, automated its processes to cut down 400,000 hours of manual labour for its employees.
ICICI Bank became a pioneer in RPA adoption by implementing automation in its 200 business processes in 2016. Today, over 1500 RPA projects are running to complete the task of 700 employees. Thus, it has helped ICICI bank reduce operational costs and achieve efficiency.

Concluding Thoughts
Robotic process automation is here to disrupt the finance sector through advanced automation. Research on the potential of robotic process automation in finance shows that general accounting operations can be automated by up to 96%. Robotic process automation in the banking sector can increase analytical performance by 50%.
Besides, McKinsey predicts that another wave of robotic automation will automate 10% to 15% of tasks in financial institutions, thereby increasing the efficiency and overall capacity of the firms.
Setting up RPA in a bank or a financial firm requires intensive employee training and structured governance. However, when properly implemented, it has the potential to do wonders and achieve all of the firm's ambitious goals.
Most importantly, you will need a professional IT partner to help you develop and implement essential RPA projects as per your business needs. It will not only help you understand where and how you can implement RPA, but also guide you to smoothly shift from RPA to futuristic technologies like AI and CPA.
Looking for a competent RPA development company?
Chaincode Consulting has the required expertise in RPA tools and technologies to develop efficient RPA solutions tailored to meet your business requirements. They have a team of highly qualified developers who will formulate a result-oriented RPA roadmap to boost your business performance and value.
Talk to RPA experts at Chaincode Consulting to explore more about their RPA services.

1495 Lake Ave
Rochester, New York - 14615

Email hello@chaincodeconsulting.com
Phone +1-585-633-7642

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This release was published on openPR.