Robotic Process Automation (RPA) is a type of technology that uses software robots, or ‘bots’, to automate repetitive manual tasks that are often carried out using legacy systems. It is seen by many in the financial services sector as a key enabling technology to reduce costs; drive efficiency, consistency and accuracy; and liberate human resources for higher-value activities.
Overview
Robotic Process Automation (RPA) is a form of software automating transaction and data-entry processes. It automates time-consuming and repetitive manual tasks, such as data entry, invoicing, data manipulation, and financial and compliance processes. This automation can be configured to mimic a human user’s actions within a given process, and can also be integrated with existing legacy systems to help improve the efficiency of those systems.
RPA can retrieve, collate and interpret data from multiple sources, such as databases, documents, web-services, or desktop applications. The technology works out the best possible way to execute the process by applying decision-making logic and algorithms. It is further enhanced when used in conjunction with Artificial Intelligence (AI) and Machine Learning (ML) technologies, such as Natural Language Processing (NLP) and Image Recognition, to further automate aspects of the process.
RPA is not the same as traditional automation; it is more adaptable and can write data to multiple systems and complete complex self-learning tasks. RPA has proved to be cost effective as it speeds up business processes and automates manual tasks in a manner that requires minimal disruption to existing systems.
Benefits
Robotic Process Automation in finance delivers the following benefits:
* Reduced human effort: RPA reduces the manual effort required by finance teams to carry out data entry, reconciliations and payments.
* Improved accuracy: Automating tasks helps reduce errors due to human fatigue and inattention.
* Increased compliance: Automating manual tasks in accordance with government regulations and industry standards helps ensure compliance.
* Reduced costs: RPA replaces expensive human labour with cheaper automation, helping to drive down overall costs.
Real World Use
Financial institutions typically use RPA to automate frontline functions such as loan servicing and payments processing. For example, a leading financial institution applied RPA to streamline its loan origination process by relying on bots to securely read, validate, and store customer documents. This allowed the institution to reduce costs by 50%, while also increasing its accuracy and compliance with regulations.
RPA has also been used to automate back office processes, such as auditing or reconciliation tasks. To take another example, a major bank was able to reduce the cost of its accounting function by 15% thanks to a RPA solution that automated its Oracle ERP system.
Conclusion
Robotic process automation has seen rapid adoption in the finance sector thanks to its ability to reduce costs and labour costs, increase accuracy, and improve compliance with regulations. Financial institutions can use automation to streamline their loan origination and back office processes, while also benefiting from reduced costs, resulting in improved operational efficiency and increased profitability.
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