The innovative technology of Robotic Process Automation (RPA) is one of the most powerful tools for optimizing business processes today. The course of all exhausting, routine processes in any business area can be significantly improved thanks to it, and the costs of their maintenance are significantly reduced.

However, is the banking sector one of those where it is possible to use robotization technology? After all, Robotic Process Automation in banking sector and automation in general is perhaps one of the most vulnerable in terms of risks, given banking specifics. In addition, the rather restrained attitude of banking IT departments to all kinds of technological innovations that could interfere with the smooth operation of banking systems and already integrated corporate applications is well known.

Also, what about security issues? Indeed, in the banking sector, they are relevant, like in no other: it is information security, the security of saving personal data, the security of operations, etc. The slightest mistake can be very expensive here – both in monetary terms and in matters of reputation bank and clients’ confidence in it.

Due to such a high degree of financial and non-financial risks, doubts may even creep in whether it is advisable to “let robots into the bank” at all. But, despite the quite fair questions and warnings, the technology of robotization of business processes is not only suitable for implementation in the banking sector – it already has successfully established itself in this field and showed the first results that are encouraging for all skeptics.

Such world-famous banks as HSBC, Credit Suisse, Citi, Deutsche Bank, and international groups Raiffeisen Bank International and BNP Paribas are already leveraging RPA and intelligent automation.

Many other institutions around the world are already on the verge of implementing Robotic Process Automation in banking and see it as a powerful and truly revolutionary tool for positive changes in the banking business.

What is RPA?

The banking and finance industry has experienced exponential growth over the past few years, thanks to the implementation of technological advances that lead to faster, safer, and more reliable services. To stay competitive in an increasingly crowded market – especially with the increasing adoption of virtual banking – banking firms had to find a way to provide their customers with the best possible user experience.

Almost 81% of banking executives are more concerned about the speed of technological change than any other sector in the industry, according to PwC. Within the company, the challenge has also grown to maximize efficiency and minimize costs while maintaining the highest level of security. To meet these needs, Robotic Process Automation (RPA) has become a powerful and effective tool.

RPA has been widely adopted in this sector to make labor-intensive banking transactions more organized and automated. According to reports, the largest share of revenue in 2019 came from the BFSI segment in terms of RPA application.

Robotic Process Automation in banking has also greatly simplified a wide range of back-office processes that once bored bank workers. By shifting much of these tedious manual tasks from person to machine, banks have been able to significantly reduce the need for human participation, which has had a direct impact on everything from productivity and efficiency to personnel issues and costs.

Recently, Japan’s largest banks announced the introduction of Robotic Process Automation to reduce labor costs and improve operational efficiency. Large banks such as Axis Bank and Deutsche bank also announced the implementation of RPA to automate business processes.

A bank employee deals with voluminous data from customers, and manual processes are prone to error. Banks around the world are considering using RPA to minimize manual processing of this huge data to avoid errors. Handling data manually is also a laborious task. Simple checking of client information from two systems can take seconds instead of minutes with bots. Implementing bots for these manual processes can reduce processing costs by 30% to 70%. Some processes in banks can be automated to free up staff to work on more important tasks.

Over the years, companies have tried to find ways to improve these departments through corporate systems, reporting tools, and interim measures to eliminate repetitive manual actions.

According to Jeremy Dean, the head of RPA at the accounting company Mazars in the USA, this phenomenon has a bright future:

“Unfortunately, these methods solved many other problems but did not help in any way to eliminate two main ones that exist in finance and accounting. The first is how to load data into the systems, and the second is how to carry out the “closing of the month.” Many people now realize that automation solves these two problems.”

How Does Robotic Process Automation in Banking and Finance Work?

How Does Robotic Process Automation in Banking and Finance Work?

To reduce errors and perform repetitive workloads, RPA also leverages the power of artificial intelligence. The advantage of RPA is that you do not need to automate the entire process, but only certain parts of a multi-step process.

Dennis Gannon, vice president of consulting at Gartner, says rule-based processes are best suited for automation. This is where RPA delivers fast results and acts like digital adhesive tape.

RPA is good at handling bottlenecks that arise in time-consuming processes that require many hours of manual labor,” Gannon revealed.

He says RPA is likely to gain widespread acceptance as a means of automating the buy-to-pay process. By starting with these transactions, finance teams can capture early results and get feedback on what is working well, and then move on to other tasks that are also easy to automate.

When it comes to fears of being unemployed due to automation, it’s important to involve finance staff on RPA projects to reduce their fears and allow them to discover new perspectives.

To begin with, project managers will involve employees in automation processes for a couple of days a month so that they can practice introducing new robots into the production environment. For the remainder of the time, they will observe how the robot is working and identify any limitations and problems in using it. This will open up other areas for them to automate their work.

RPA consists of software robots, which are patterns of repetitive actions. The robot mimics normal human functions: reading text in an application, copying information, and transferring it to another application. IT departments use RPA platforms to create, monitor, manage, reuse, and save robots and the actions they perform.

The simplest robots capture the mechanical actions of a person and copy them. This is a kind of sample. Based on it, the developer will create a stronger robot that will not break if the application screen is slightly changed. Other artificial intelligence technologies often complement robots. For example, optical character recognition (OCR) is used to transfer text from a paper document, and machine learning is used to match fields in an invoice with fields in an application. This combination is sometimes referred to as intelligent process automation.

Robotic Process Automation in banking also complements a number of other technologies. Sometimes IT departments use low-code / no-code frameworks to create lightweight automation that is implemented as code, API management frameworks, or platform-as-a-service, which enables direct communication that is much faster than RPA. However, RPA has access to any application available to humans, and this is its advantage over other technologies.

Studying the market of implemented RPA solutions in the international IT segments, we can conclude that the use of RPA does not actually depend on the industry, and this technology works in any market segment.

However, this article is devoted primarily to Robotic Process Automation in banking and finance.

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