Ramesh Muniyandi Head RPA, Aspire Systems.
The digital explosion has truly made a mark on the Indian banking market with banks having realized the importance of a digital and mobile approach as opposed to that of a physical bank branch. However, with time the page has turned with RPA turning out to be the next biggest thing to shake the banking industry in India. The arrival of bots promises so much – a more efficient workforce, lesser operational costs, quick implementations and even quicker turnaround for ROIs. Robotic Process Automation has capabilities across the front, middle and back office operations and can make several modern day banking miracles.
With an in-depth analysis of 2 of the most common RPA use-cases, it can be clearly seen why RPA can be considered the modern day savior for banks, especially with GAFA (ie. the common acronym for the Big 4 – Google, Apple, Facebook and Amazon) and several neo and challenger banks breathing down their necks. In each of the use-cases, where RPA can be implemented, it can be clearly seen that banks benefit the most with time and cost savings. Each potential automation process can see savings in time and cost, within the initial few months.
When you consider account opening process, it is the first interaction of the customer with the bank and hence first impressions matter. However, experts state that 41% of customers feel the need to shift their bank before even signing on for them due to the excessive paperwork and document verification. This shows a massive hole that needs mending and RPA in the account opening process can lead to a 69% reduction in the number of manual tasks undertaken.
Processes such as the verification of account opening requests and pre-defined forms from various documents along with account verification can be automated with the use of bots. Besides these processes, RPA can also help in the case of missing documents by alerting the system and therein alerting the customer of the same. Finally, RPA helps in delivering cheque books and validates the need for the generation of one, based on several business rules.
Just imagine, this is just the influence of RPA in one single process.
Another very common use-case for RPA implementation is for the processing of credit cards, wherein there are a lot of verification of documents, annual income, credit risk analysis and decision making. Generally, the verification, scanning and approval process are all manual processes which tend to extend for week and in the end, the welcome kit is received by the customer, several weeks to months after the first intent to obtain a credit card. With RPA, there would be a 61% reduction in the number of manual tasks undertaken by the bank.
An Indian Banking Success Story
A couple of years into ICICI bank’s RPA journey, the bank was able to start processing close to 10 lakh transactions daily through 200 different robotics software programs. Within 2 years, the bank scaled up to 750 software robots and currently handle 20 transactions per day. Currently, each of these bots work in retail and wholesale banking, as well as forex, treasury, agro and international operations. So how did ICICI bank benefit? The decrease in response time has come down by 60% and real turnaround has taken place. Error rates are close to zero, productivity is unmatched, and many more benefits have come along the way.
What does this mean for the bank and what does it mean for the customer?
With RPA, the most important aspect is that bots don’t have properties that lead to errors and inefficiency. That in itself saves weeks for a particular process and there is also a massive 40% to 60% reduction in processing costs that is generally incurred without RPA. There are also minimal risks due to the rise in automated checks at a faster pace. Moreover, there is an ROI turnaround for RPA implementation within 6 months. Better compliance takes place and there is also a huge reduction in errors. More importantly, there is improved data accuracy for banks due to automated data extraction and entry. These are just some of the massive cost and time benefits that banks can face and there’s no better time to act on bringing RPA into a bank’s technology stack than now.
- Ramesh Muniyandi is Head RPA, Aspire Systems.