Robotic Process Automation (RPA)
The Banking Financial Services (BFS) industry is one of the most data-intensive industries that operate in a highly regulated market. The volume of data and analytics that would be required in the future exceeds the current processing capabilities. The global compliance landscape in BFS is expansive, covering a large number of regulations around finance and risk management functions, spanning KYC, monitoring transactions against potential money laundering or fraud, financial reports, risk assessment and exposure reports, periodic disclosures and so on. Most of these functions are manual in banks, which make these activities time consuming and susceptible to errors.
Banks are constantly looking to improvise their regulatory compliance processes, for optimizing costs while ensuring adequate oversight and accurate reporting. The success of Robotic Process Automation (RPA) in the last couple of years in automation of routine rule- based operations for trimming down costs while increasing productivity of organizations across industries, has compelled banks to turn their attention to similar processes in compliance. In BFS, the focus of robotic automation is now sharply moving towards regulatory compliance functions, and is destined to revolutionize the compliance landscape globally in the next couple of years.
Organizations today are increasingly adopting new-age technologies like Internet of Things (IoT), Cognitive Computing and task-level RPA to overcome challenges like reducing Total Cost of Ownership (TCO), increasing workforce efficiency, reducing human error and so on. RPA, in particular, brings the speed of digital to the market while reducing the high cost of employing humans for executing Standard Operating Procedures (SOP).
RPA replicates human actions to complete rule-based task. RPA gives maximum benefits when combined with process optimization and correct process identification technique. System transformation takes huge amount of time and investment whereas RPA can offer equal or more benefit in significantly less time and lower cost. And that’s one of the reason the BFS space is witnessing adoption of RPA on higher side compared to other verticals.
Mindtree has taken client onboarding automation as one of the use cases and built an RPA solution on it. The current processes of on-boarding customers in the BFS industry are disjointed and resource-intensive which leads to multiple issues such as capturing data through multiple channels, not capturing all the required information, inability to access the required information in an expedient manner, and excess time consumption due to manual and sequential processing. Since Client Onboarding is the first step in the customer journey with the firm, these challenges lead to decreased customer confidence. The Client Onboarding Automation has the features companies need to accelerate Onboarding process and minimize inefficiencies:
- Simplified on-boarding solution, transparency of process to customers, minimize capture of duplicate data from customers which results in superior customer experience and high customer confidence.
- Reducing burden on FS/Banking firms by on-boarding process optimization and release time for value-added sales and client servicing activities.
- High degree of data integrity by customer data integration and effective compliance with regulatory authorities through improved compliance practices.
- Quicker realization of customer revenues through faster on-boarding life cycle time, support cross-sell/up-sell products to customer through comprehensive on-boarding process and ultimately provide a competitive edge in the market place.
- Firms will be able to capitalize on the high growth opportunities and business potential in the industry through improved on-boarding processes.
The benefits of this solution are as follows:
- Accelerate order-to-cash flow by winning new clients, faster
- Increase revenue by cross selling more, faster
- Reduce operational costs by automating manual processes
- Decrease loss by reducing new client abandonment
- Reduce churn by improving client satisfaction and loyalty
- Increase productivity by freeing up staff and management time
- Reduces risk of compromising the integrity and comprehensiveness of critical client data
- Improve quality control by standardizing global best practices
In the asset servicing space, Mindtree has considered corporate action and securities lending as the use cases. The automation of corporate actions processing is a textbook example of the overlap between external standardization, process harmonization, and technology innovation that is necessary for operations professionals to achieve real progress whereas the drivers for securities lending automation is process efficiency and improvement. The increase in volume of transactions require a level of automation for operations to keep up with the pace.
The corporate action automation solution aims at automation of the corporate action lifecycle. The various tasks involved in the lifecycle of corporate action (CA) are scrubbing of CA announcements, notifications generation, calculation of eligibility and entitlements, sending instructions and generating accounting entries. The securities lending automation solution aims at automation of the securities lending process. The various tasks involved in the lifecycle includes initiation, risk management, short sale negotiation, settlement, collateral substitution and addition, recall and guarantee. The benefits these solution render are as follows:
- Straight through processing of corporate action events and securities lending transaction
- Efficient management of operational risk
- Cost savings of about 25-30% due to reduction in manual process
- Reduce financial losses due to missed deadlines
- Increased productivity of the back office staff as manual task have been automated
For the aforesaid solutions, Mindtree uses its proprietary RAPID framework to maximize benefits from all RPA implementations. Our RPA opportunity identifiers include the following:
Moreover, our RAPID framework not only helps implement RPA in the least amount of time, it also enables quick ROI. This is because we use our POC-driven approach to scale it up to enterprise grade implementations.