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Why do banks have a dire need of Robotic Process Automation (RPA)?

Kriti Swarup | AUG 26, 2020

With the onset of pandemic, banks have realized that the process workflows, that worked earlier, are unable to cope up with the current remote working environment.


Ensuring “business-as-usual” has put tremendous pressure on banks for critical operations. It has become exceedingly critical that banks adapt to the changed paradigm and leverage technology in every possible manner to enhance their operational efficiencies.

Though, automation has been leveraged in the banking sector, yet in current situations, RPA has become overly important to quickly digitize and automate business processes heavily dependent on resources, and speed up seamless service delivery to the customers.

Operational Challenges faced due to Covid-19

Amidst the pandemic situation, every industry is grappling with cost overheads and profits. Banks’ business drivers have also been impacted and they have a need to reduce their operational cost, but at the same time push their revenues up for stability. This makes it highly important for banks to leverage all technology levers and get rid of the bottlenecks in the way of servicing customers in a secure and reliable manner.


Banks are now, more than ever, paying attention to process optimization, digitization and automation to deal with inherent operational challenges like:

  • Legacy systems – Complex access to customer data by accessing multiple applications and systems

  • Manually exhaustive processes - Huge volumes of manual data processing

  • Lack of digitization – Referring paper based documents to keep track of data in the core system

  • Business processes in silos – Frequent coordination and exchange of documents to execute critical business processes like Loan Processing, Customer On-boarding, etc.

  • Peak volumes – Addressing increasing no. of customer requests through multiple channels like email, phones, etc.

Compliance and Regulatory Changes

Along with multiple challenges on the operational side, one consistent challenge is to be compliant to frequent regulatory changes and, often with less Turn Around Time (TAT). Due to Covid-19 followed by long lockdowns, there have been multiple changes coming in almost every day in order to adapt to current conditions without impacting the stability of the banks.


In such a scenario, there is a necessity of “quick to deploy” solutions with zero probability of errors. This is where Robotic Process Automation (RPA) has become an extremely effective technology.

Modernize banking operations with RPA

RPA is significantly adopted in the banking sector worldwide, and has automated and organized several time consuming business processes.


Banks have witnessed dramatic operational improvement by automating several customer facing and back office processes like:

  • Customer On-Boarding

  • Accounting and Billing

  • Contract Management

  • Service Requests

  • Loan Processing

  • Credit Card Processing and many more

How RPA is fostering banks’ digital journey?

With the advent of pandemic, RPA adoption has witnessed a surge, resulting into:

  • Compliance – In response to regulatory announcements due to pandemic, there was an immediate requirement for multiple changes to be executed in a matter of days. RPA played a greater role in implementing these changes and be compliant without any delays.

  • Digitization – Increased adoption of RPA on an enterprise level has led to an end-to-end digitization (paper-less) making it a key to improvising productivity and stability even in unpredictable market conditions.

  • Seamless Customer Service – Numerous operational changes were declared in order to financially help individual customers, MSMEs, and other organizations to survive through the situation without succumbing. For example, Loan repayment was deferred and such changes were to be reflected in all banking systems at a scale that was never witnessed before. However, with RPA, it was an easy and error-free exercise resulting in a trouble-free customer experience.

  • Progressing to open banking - By way of digitization, standardization and seamless access to data, RPA is helping banks gear up for “open banking” which requires massive amount of work on processing and presenting data from different applications and systems. Once the open banking requests start increasing, banks must be prepared to handle such peaks in no time.

Conclusion

Situations like Covid-19 have uncovered multiple systemic weaknesses not just in banking but across industries. RPA along with multiple other technologies has played a significant role in driving organizations to move beyond these challenges, withstand the impacts of the pandemic and come out stronger and stable in the future.


NSEIT is amongst the early adopters of the Robotic Process Automation (RPA) solutions as we understand the BFSI industry closely and have been empowering them to be future ready. Go to Business Transformation and understand how you can emancipate from conventional business process approach and step ahead in your Digital Transformation journey.

Kriti Swarup

Presales - Digital Transformation

Associated with NSEIT for around 2 years, and with overall 8+ years of experience, Kriti has been managing end-to-end presales and alliance for multiple digital transformation technologies like Intelligent Process Automation, Business Process Management and Low-code / No-Code Development across Banking, Insurance and Financial Services Market Space.

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