Banking Automation: The Complete Guide

What to do about this paradox is a complicated question, but what is certain is that whatever action is taken will have a significant impact on future society — one that will belong to Generation Z. Implementing automation allows you to operate legacy and new systems more resiliently by automating across your system infrastructure. According to the 2021 AML Banking Survey, relying on manual processes hampers a financial organization’s revenue-generating ability and exposes them to unnecessary risk. By making faster and smarter decisions, you’ll be able to respond to customers’ fast-evolving needs with speed and precision. The bank’s newsroom reported that a whopping 7 million Bank of America customers used Erica, its chatbot, for the first time during the pandemic. A digital portal for banking is almost a non-negotiable requirement for most bank customers.

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Layer 3: Strengthening the core technology and data infrastructure

Once you’ve successfully implemented a new automation service, it’s essential to evaluate the entire implementation. Decide what worked well, which ideas didn’t perform as well as you hoped, and look for ways to improve future banking automation implementation strategies. For many banks, ensuring adoption of AI technologies across the enterprise is no longer a choice, but a strategic imperative. Envisioning and building the bank’s capabilities holistically across the four layers will be critical to success. The financial industry has seen a sort of technological renaissance in the past couple of years. But this has also lead to a complex scenario where the problem has to be addressed from a global perspective; otherwise there arises the risk of running into an operational and technological chaos.

Moreover, you’ll notice fewer errors since the risk of human error is minimal when you’re using an automated system. This scenario sounds promising, but achieving it is easier said than done. This bank then did some due diligence to determine whether there was a viable business case to automate each process within a reasonable time frame. It concluded that only half the opportunity (measured by the automation business cases completed on each manual process) could actually be captured.

Commercial banking

June 20, 2019Today, deep within the headquarters and regional offices of banks, people do jobs that no customer ever sees but without which a bank could not function. Thousands of people handle the closing and fulfillment of loans, the processing of payments, and the resolution of customer disputes. They figure out when exceptions can be made for customer approvals and help the bank comply with money laundering rules, to name but a few. Although automation may bring a host of benefits, embracing it means eliminating some human-occupied posts and retraining staff. According to a 2019 report by Wells Fargo, 200,000 jobs could be eliminated over the next ten years in the banking industry due to chatbots and other automated software.

Maximize day-one readiness, decrease average handling time and reduce rework. Accenture surveyed bank executives worldwide to understand how they view their journey to operations maturity. It’s about reaching new levels of operational maturity to choose smarter, act faster and win sooner. Digitally-focused banks have benefited from market valuations that, on average, were 18% higher than less digitized peers in 2019, and 27% higher in 2020. The potential upside of doing so is considerable, while the cost of inaction is equally consequential.

Today, banks offer standardized products hardcoded with specific benefits, parameters, and rules–30-year mortgages, travel rewards credit cards, savings accounts with minimum balances. A variety of operational roles are charged with supporting these products and managing the rules governing them. In future, these activities will be automated, and employee roles will shift toward product development. Instead of evaluating credit risks and deciding on mortgage approvals, operations staff will work with automated systems to enable a bank to offer its customers flexible and customized mortgages.

Meanwhile, operations and business personnel push to automate everything everywhere as soon as possible, without proper planning and evaluation. These pressures spread IT teams too thin, diverting their attention from the largest areas of opportunity. Because such projects are carried out much more quickly than traditional development efforts, IT departments struggle to set up the necessary infrastructure on time, and the teams are not focused on the value or necessity of additional features. The bank also used the intelligent automation platform to expedite its document custody procedures. Consider, for example, the laborious paperwork that is typically required to refinance homes. When banks, credit unions, and other financial institutions use automation to enhance core business processes, it’s referred to as banking automation.

They transform complex datasets from different loan trading desks, previously managed in varied formats and structures, into a unified, standardized format. This standardization is key to avoiding data chaos and ensuring efficient, coherent management post-merger. 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. ​The UiPath Business Automation Platform empowers your workforce with unprecedented resilience—helping organizations thrive in dynamic economic, regulatory, and social landscapes. The world’s top financial services firms are bullish on banking RPA and automation.

These trials have proved that automating end-to-end processes, which used to take 12 to 18 months or more, is doable in 6 months, and with half the investment typically required. In banking M&As, the consolidation and standardization of financial data are crucial. Automated platforms can harmonize disparate data systems from merging institutions, ensuring seamless integration.

Since little to no manual effort is involved in an automated system, your operations will almost always run error-free. Working on non-value-adding tasks like preparing a quote can make employees feel disengaged. When you automate these tasks, employees find work more fulfilling automation in banking operations and are generally happier since they can focus on what they do best. For example, a sales rep might want to grow by exploring new sales techniques and planning campaigns. They can focus on these tasks once you automate processes like preparing quotes and sales reports.

• Faster front-end consumer applications such as online banking services and AI-assisted budgeting tools have met these needs nicely.
• First, as the data show, automation, by reducing the cost of operating a business, may free up resources to invest in other areas.
• For the best chance of success, start your technological transition in areas less adverse to change.
• The technology is rapidly maturing, and domain expertise is developing among both banks and vendors—many of which are moving away from the one-solution-fits-all “hammer and nail” approach toward more specialized solutions.
• Many banks and financial firms are grappling with the process of digital transformation, and automation is playing a central role in these efforts.
• You can deploy these technologies across various functions, from customer service to marketing.

Today’s operations employees are unlikely to recognize their future counterparts. Roles that previously toiled in obscurity and without interaction with customers will now be intensely focused on customer needs, doing critical outreach. They will also have tech, data, and user-experience backgrounds, and will include digital designers, customer service and experience experts, engineers, and data scientists.

The journey to becoming an AI-first bank entails transforming capabilities across all four layers of the capability stack. Ignoring challenges or underinvesting in any layer will ripple through all, resulting in a sub-optimal stack that is incapable of delivering enterprise goals. Traversing this path won’t be easy but the sooner the banking industry begins this journey, the better it will be for everyone, even those whose jobs maybe most impacted by automation. Will advances in robotics, artificial intelligence, and quantum computing make machines so smart and efficient that they can replace humans in many roles today? The answer, if you believe the assertions of many experts, seems like a yes. In this article, we’ll explore why the banking industry needs hyperautomation, its use cases, and how banks can get started with their hyperautomation journey.

Given the challenges they face, banks need more than incremental or isolated productivity gains. To achieve improvements in cost efficiency and customer experience that make a significant bottom-line difference, they need to rigorously apply the full set of levers across their entire operations cost base. Equally important is the design of an execution approach that is tailored to the organization. To ensure sustainability of change, we recommend a two-track approach that balances short-term projects that deliver business value every quarter with an iterative build of long-term institutional capabilities.