Robotic Process Automation (RPA) is a powerful technology that is used by banking firms to maximize organizational efficiency while keeping operational costs low. From streamlining back office operations, customer workflows, and document processing, RPA solutions make it convenient for bank employees to process enormous volumes of customer data without sacrificing accuracy or precision. RPA has also introduced recent innovations which make it possible for firms to process transactions seamlessly.
In this post, we’re going to talk about the latest RPA automation trends and applications in the finance and accounting industry.
RPA trends in financial services
RPA automation is the process of automating labor intensive, high-volume tasks done manually by users and enabling them to be performed automatically without human intervention. In the past few years, large organizations have been investing in RPA automation solutions and integrating them with other digital technologies. RPA bots are low maintenance and are configured using rule-based mechanisms, which means there are lower rates of human errors, increased efficiency, and faster processing times.
Below is a list of the latest RPA automation trends in the financial service sector:
1. Intelligent automation
According to Gartner, the Robotic Process Automation (RPA) industry is estimated to be valued at USD 1.89 billion in 2021 and this figure is projected to rise, with intelligent automation being at the forefront of RPA in the BSFI sector. The intelligent automation sector is forecasted to grow at a CAGR of 12.9% annually from 2018 to 2023 and trends show that these solutions will assist operation teams in automating various business functions. From loan application tracking, asset management, reducing operational costs, and speeding up banking workflows, intelligent automation will enable financial organizations to read data from multiple sources and use a rules-based approach for processing applications faster.
2. Customer experience
Complete process reengineering is one of the many focus points of using RPA solutions in finance and accounting services. With this, banks can identify all stages of the customer journey and create workflows that streamline flows among them. RPA enables customers to access and map out their financial data, giving them an intuitive user experience and letting them navigate through business complexities with ease. Studies show that banks are investing $60 million USD annually on average into automating KYC Compliance and corporate treasury processes using RPA solutions.
3. New product launches
RPA automation is used for new product launches and introducing innovative services. Banks are developing lending apps for customers who want to take loans digitally. RPA workflows are being globally used in key processes such as processing financial transactions, reading KYC documents, human resources, managing customer relationships, and for providing quick resolutions to queries. Customer onboarding and offboarding processes are being transformed into seamless user experiences thanks to finance automation workflows.
4. No more paperwork
RPA automation is enabling banks and startups to say goodbye to paperwork. Organizations are saving millions of hours in 2021 by storing their data electronically and removing the need for paper-based document storage. It is expected that in the coming years, employees will be freed of doing time consuming tasks and focus on more productive areas of finance activities.
5. Optical Character Recognition (OCR)
Optical Character Recognition (OCR) is a new innovation under the umbrella of RPA that is used for scanning documents and transferring the digitized data into ERP systems. One of the major barriers in document processing is the storage and analysis of unstructured documents. OCR is integrated with complex business processes to seamlessly pull data from a variety of documents and structure it into easily readable formats. Banks are using OCR solutions to track financial transactions, generate fraud reports, and keep their general ledgers updated for better presenting reports to customers and stakeholders about their performance.
RPA and ML integrations can be paired with legacy systems and used for upgrading system workflows. It is estimated that finance departments save upwards of $878,000 per year and reduce up to 250,000 hours of rework by simply investing in these technologies.
Benefits of RPA in finance and accounting
A majority of financial institutions and banks are using RPA to automate their accounting workflows. RPA is becoming indispensable for businesses due to its following benefits:-
1. Reduces human errors
RPA workflows in finance and accounting help employees reduce data entry errors by ensuring precision. 32% of enterprises are automating every function and banks enjoy competitive advantages by speeding up transactions, data processing, and getting information that is both accurate and reliable.
RPA tools can be used to update legacy systems and make data models scalable for organizations. Bots are used for reducing significant labor costs, managing huge volumes of data, and migrating to other systems.
3. Predictive analytics
Organizations use RPA processes to get deeper insights into their data and analyze it. This leads to better reporting and predicting patterns in customer data submissions.
4. Ensures regulatory compliance
Organizations have to address legal compliance issues and ensure data follows state regulations. RPA tools ensure financial success by making sure data integrity is maintained, is of high quality, and complies with legal rules.
Use-cases of RPA in finance and accounting
RPA tools don’t need breaks and can work 24x7 for processing data, unlike humans. The most popular use cases of RPA in finance and accounting are:
1. Finance account reconciliations
One of the challenges in finance and accounting is comparing account balances and ensuring transaction details are correct. RPA tools are used to pull data from multiple accounts, compare, and validate them
2. Process invoices
Banks and accounts payable departments in organizations use RPA to generate and automate invoice processing. Invoices come in a wide range of formats and RPA tools can process over millions of documents in different formats.
3. Purchase order processing
OCR and Machine Learning in RPA is used to automate purchase order processing and streamlining shipments. RPA ensures the completeness of data and helps automate data extraction from paper-based documents for transactions.
4. Vendor contract compliance
This is another area the technology is excelling at and RPA workflows ensure vendor compliance terms and conditions are met. RPA bots scan through invoices and extract key value pairs such as discounts, vendor details, rebates, etc.
When it comes to finance and accounting, it is clear that with more innovations, RPA tools will revolutionize the BFSI sector. If you’re on your path of digitizing document processing, sign up for a free demo with Docsumo and get started today.