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Why Banks Should Get On The Intelligent Automation Wave

June 21, 2019 - Richa Dudeja Analyst, Product Management, EdgeVerve

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Banking involves a lot of manual activities which are repetitive and time consuming. The Banking systems have evolved from managing ledger management manually to Core Banking Systems (CBS). With the evolution of Indian economy and hordes of banking products and services available, there has been an exponential growth in the banking business.

It is no surprise that the banking industry trends tend to change but the lending trends rather stay consistent. When it comes to giving a loan, the request for a loan application goes through an entire complex process of approvals. A lot of steps in this process are rule based and some need to follow a specific trend and many of them are manual interventions.

In the recent past there have been a lot of examples where the borrower has not been able to repay, however there has been no responsibility taken by the sanctioning committee for the default. Analysis of the cash flows of the organization, future plans, repayment plans have to be put in place before the loan can been approved. In this process, credit ratings play a major role. Individuals with credit ratings above a certain value are considered as ‘low-risk’, who can pay their debts on time. While this is just one of the examples, there are various other rules that have to be applied before a loan is sanctioned.

Of late, you would have seen a tremendous increase in bankruptcies being declared by premium businesses. The bank’s limitation in recovering the money in case of liquidation of businesses. As per the latest examples given by the SMEs across banking industry, there is enough and more existing data that can throw some light on the trends in non-performing assets.

Getting to know the pattern of the financial ratio’s calculated from the cash flows varies from sector to sector but there is no trend that is followed by the banks currently.
There are lot of applications that need manual intervention for the amount to be approved but there has been no trend to the applications being approved, usually the application is approved based on a lot of other factors which go unaccounted. To stop this there has to be a trend analysis study of all applications and they have to run through the rigorous checks for the approval.

The biggest bottleneck in banking industry is the repetitive nature of activities being performed which have rules but end up taking lot of time because it still runs on lot of old school methods. Identifying the trends/processes and rules will not only save time but help in reducing the turn-around time and decrease losses.

Banks need to look at automation projects as an investment. This in-turn helps in quick results with less resources in the loan processing department. Considering the extensive change in the psychology of our economy we would need to get the approval processes automated with least intervention in the manual decisions so that the approvals are quick. This will also help in optimizing manpower efficiency. Getting a competitive edge over our competitors and quick processing can become one of the USP’s of the bank upon adopting automation.

This is the hour where banks need to transform digitally for achieving a competitive edge over other banks and gaining an exponential increase in revenue. With AssistEdge, a leading RPA product integrated with Artificial intelligence, EdgeVerve is best suited to meet these requirements of digital transformation. With its parent company as Infosys Ltd. the technology stack available is undebatable. So are you ready to start?

Richa Dudeja

Analyst, Product Management, EdgeVerve

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