RPA and its applications in banking sector

Robotic Process Automation although is not a very old term but it has its roots in process automation which has been around since quite some time. Process automation also has its roots in process management and myself being in business process management field for quite some time now (10 years to be precise) can clearly understand how things have evolved from business process management to process automation to RPA.

RPA today a buzz word in the market and is touching almost every industry vertical, BFSI finds RPA very relevant in various business types may it be Retail, Invoice Finance or Dispute handling. 

For the scope of this blog I would discuss how RPA is influencing some of the manual processes

•  Customer Onboarding : Although globally, retail banking is moving towards digital customer onboarding and making the process paperless, there are still many areas where a document is submitted b customer or a handfilled form is submitted by customer which needs to be processed manually by a human and the data is fed into the system. This is where RPA is helping banks in a big way as the tasks which was done by humans is now being automated and robots are able to do such taks by reading the hand written forms or by scanning and evaluating the documents submitted by prospective customers. For examples documents submitted by individuals can be scanned and ots can verify if these documents are as per the compliance needs
• Processing claims : Claim processing is often one of the most human intensive process as it requires human intervention at various levels. However there are many subprocess in the entire claims journey where humans are being replaced by bots. For example, customers are often required to submit various third party documents such as third party inspection certificates, id proofs, etc. Bots are now processing the documents and entering the values on behalf on humans 
• KYC and Due diligence: KYC often requires customers submit their identification documents and banks processing these documents to ensure that they have enough data to make the customer KYC compliant. KYC is one area where RPA is making big changes buy allowing banks to process thousands of records parallely and thus becoming more independent of the human workforce

These are some of the major areas where RPA is helping banks and financial institutions by helping them reduce the dependency on workforce and thus giving them ability to scale up  the operations and reduce processing time for various processes. 

Return on investment for digital transformation initiatives

The dynamic technology environment today has left the CXO in a midst of a quagmire as the CXO has a limited technology budget and endless potential investment opportunities in the field of technology which could improve the performance of the bank. Clearly there is a need to get at least some guideline on the kind of returns on investments which the bank would be getting for any investment made in the field of technology. 

In this rapidly digitizing ecosphere businesses are still at a nascent stage where most of the industry verticals although now realize that the future is digital but they are either not yet technologically ready to embrace it or have just started assessing the impact of this radical shift in the business models is impacting them and started reacting, there are exceptions though. Banking vertical being most technically inclined to digitization as compared to vertical like Energy or Manufacturing, becomes the obvious choice for this white paper. Every well-known bank today has at least one substantial size project in pipeline where it is trying to improve its digital footprint in one of the three areas i.e. Customer Relationship, Operations or Partnering with Other players in its ecosystem.

It clear that any digital transformation initiative is fruitless unless there is a clear buy in from the top management, in fact most successful digital transformations initiatives have been the ones which have been initiated from CXO down. It is imperative for any organization to transforms its operations into a more digital state in this rapidly digitizing economy. The next question which challenges a CXO is “Which initiatives would give the best results in terms of Returns of Investment?” and/or “Where should the IT dollar be invested to get maximum bang for the buck?” and/or “What kind of returns the top management can expect from these initiatives?”. In order to enable CXO understand the results and ROI, it becomes imperative for a digital transformation advisor to evaluate to identify variables which factor to the success of these initiatives. 

Which sectors are benefiting the most from social media!

According to Nielsen 85% of the world’s online population has used the internet to make a purchase - increasing the market for online shopping by 40% in the past two years (Source)

84% of internet users in Asia Pacific have made an online purchase as compared to 92% in North America and 93% in Europe. (Source)

 As per another Nielsen report on Internet users in India (Source)

• 26 % of online discussions mentioned brands
• 92% have read online product reviews in the last one year
• 77% visited the product website after reading the review on social media
• 58% of all social media users have made buying decisions by using online reviews as their main source of information

Now let us further magnify the trend in context with different sectors.

Retail: As per the report retail sector is the most benefited sector from online purchase sales. Books, Shoes, clothing and accessories are the most sought after products which are purchased online and the trend in Asia Pacific is in line with the global trends. In Asia Pacific Region 38% of the users in surveyed said that they have bought Clothing, Accessories or shoes on the Internet in the last three months as compared to 39 % in North America.

Travel and Hospitality: Travel and Hospitality is one sector which has the second highest degree of exposure on internet. Increasingly more and more people are planning their travel first on the internet and then on road. None of us can think of planning a vacation or business trip in absence of internet access. Indian Internet users have highest number of air tickets online, more than any other country in the world. 70% of the users surveyed said that they have bought airline tickets/reservations on the Internet in the last three months,

So all the above mentioned facts bring us to a conclusion that online purchase is becoming a reality with every passing year and trend is common across the globe.