{"id":9439,"date":"2020-08-26T05:36:02","date_gmt":"2020-08-26T05:36:02","guid":{"rendered":"https:\/\/www.experfy.com\/blog\/?p=9439"},"modified":"2023-11-15T15:22:55","modified_gmt":"2023-11-15T15:22:55","slug":"going-beyond-digitization-with-back-office-process-automation","status":"publish","type":"post","link":"https:\/\/www.experfy.com\/blog\/fintech\/going-beyond-digitization-with-back-office-process-automation\/","title":{"rendered":"Going Beyond Digitization with Back-Office Process Automation"},"content":{"rendered":"\t\t
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Banking Automation is the future of the financial industry. In 2017 McKinsey\u00a0[1]<\/a>\u00a0reported that newer technologies were causing disruption in financial institutions and that companies adopting digital alternatives would increase their profits and productivity as a result. Accenture\u00a0[2]<\/a>, reported that digitally focused and digitally active banks have seen a net revenue growth of 1.2 and 0.5 percent respectively, whereas the rest has had zero growth.\u00a0<\/p>\n\n\n\n

However according to the Digital Banking 2019 Report on Retail Banking Trends and Predictions\u00a0[3]<\/a>\u00a0almost half of the surveyed organizations said their digital transformation journey was in the early stages, with only 7% believing they are a \u2018digital organization\u2019. More traditional banks are seeking to adopt technology faster, as consequence of Covid-19, and as they try to become more digital to meet the requirements of their customers who are working remotely and require a constant digital customer experience. In Europe digital adoption jumped from 81 percent to 95 percent as a result of the COVID-19\u00a0[4]<\/a>. Besides the obvious, it\u2019s important to identify other elements that make the implementation of automation and speed up of digital transformation vital for the banking industry.<\/p>\n\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Why Automation Adoption is imperative for Banks<\/strong><\/h3>\n<\/h3>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Costumers are doing everything\u00a0digital; from ordering grocery, to talking to their doctors, making payments, virtual tours, you name it. They expect the same level of simplicity and convenience from the financial institutions they bank with. This becomes even more relevant today, while we are still facing Covid-19 and for the post pandemic period.\u00a0<\/p>\n\n\n\n

To start, in Italy, Spain, and the US, 15 to 20 percent\u00a0[5]<\/a>\u00a0of customers surveyed expect to increase their use of digital channels once the crisis has passed; in other markets that percentage ranged from 5 to 13 percent. Preference for handling everyday transactions digitally is as high as about 60 to 85 percent across Western European markets, even for customers 65 years of age or older\u00a0[6]<\/a>, while 73% of Americans most often access their bank accounts via online and mobile platforms. In addition, Europe\u2019s neobanks could have up to 85 million customers or about 20% of the population over the age of 14, by 2023\u00a0[7]<\/a>; given the\u00a0agility,\u00a0flexibility\u00a0and\u00a0technology\u00a0deployed in these new\u00a0banking\u00a0channels.<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Automation offers Financial Institutions exactly what they have identified as the three top priorities for the industry in 2020 and into 2021: Digital Transformation, Improvement of Customer Experience and Cost Management\u00a0[8]<\/a>; on this topic alone we have that the average company loses 552 hours annually to administrative or repetitive tasks, equivalent to one-third of the working year\u00a0[9]<\/a>, this can be dramatically reduced or eliminated with automation technologies.\u00a0<\/p>\n\n\n\n

But now, why Back-Office Operations? Besides the already mentioned inefficiencies, the industry has done a lot on the customer-facing side, however, unless banks streamline and automate back-office operations, the everyday work will be affected, slow and inefficient.\u00a0At the end of the day, the customer keeps being affected due to human error, slow processing, tracking issues, repeated work, poor communication, inconsistency, etc;. In order to provide a customer centered service, both back-office operations and customer-faced operations need to be connected and streamlined. We also do good to remember that automation is not only a cost saving investment, but also a customer retention tool to generate increased profitability, agility and flexibility.<\/p>\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Automation Technologies for Banking Operations<\/strong><\/h3>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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1. Digital Process Automation (DPA)\u00a0<\/strong><\/h4>\n<\/h4>\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t
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Unlike Robotic Process Automation (RPA)\u2013 standalone technology that automates existing rule-based processes \u2013 DPA unifies different technologies to transform your entire organization. It allows you to have a holistic approach to automation, from start to finish, end-to-end.\u00a0DPA streamlines processes and optimizes them for higher productivity, cost reduction, work simplification and better collaboration. It assists with automation connecting processes across the organization under a unified system and where human action could be needed.<\/p>\n\n\n\n

The platforms are designed to allow anyone to design workflows regardless of coding experience; these ones are called no-coding applications; although you also find low-code applications. However, these ones will need some kind of intervention from a skilled professional. These platforms simplify integrations and workflows through APIs, smoothing out data sharing across apps. With this freedom, LoB managers and decision-makers can quickly automate processes reducing or eliminating IT intervention.\u00a0<\/p>\n\n\t\t\t\t\t\t\t\t<\/div>\n\t\t\t\t<\/div>\n\t\t\t\t

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Back-office operations, Human Resources, Customer Support, Vendor Management, routine finance functions, Compliance, Infosec and IT are the areas that have benefited the most until now; however, DPA can take care of almost any process where human intervention is required.<\/p>\n\n\n\n

To understand if DPA is the right technology for your project ask yourself these questions:\u00a0<\/p>\n\n\n\n