Financial institutions are multifaceted- running a multitude of functions in both the front and back office. Despite the digital revolution disrupting the industry, many banks and credit unions still have many manual workflows and processes in place. These manual methods prevent your employees from being as productive as they can be, put you at risk for errors and inconsistencies in data, and typically cause friction for your customers. The competitive market and changing customer expectations have made it more important than ever that you modernize and automate how your institution operates.
Why are banks embracing automation?
Banking involves a ton of repetitive tasks that can waste the time of your employees and customers and cost your institution resources and money. In fact, it’s estimated that companies lose 20 ‒ 30% of their revenue to inefficiencies every year. Trying to make your manual processes work in this digital era can lead to negative consequences for your bottom line and your customer experience. While automating manual processes can streamline your banking workflow, improve operational efficiency and productivity, enable superior customer engagement, and increase cost savings.
Here are 7 processes that when automated can transform your banking experience:
Customer onboarding can be a rigorous process– if done manually, it demands a lot of time from your customers and employees and extreme caution to avoid error. It’s also the first interaction many consumers have with their FI and all it takes is one obstacle or time-consuming task to send them running to your competitors. Therefore, you should look to make onboarding as easy and convenient possible. Your team shouldn’t have to wade between paper records of proofs of address, passports, and tax documents and prospects shouldn’t have to come to the branch to submit this paperwork. Automating your KYC process can eliminate manual preliminary legwork and efficiently verify your customers through biometrics, id verification, and data validation.
The current lending market consists of fintechs that are able to make instantaneous decisions within a matter of minutes. Yet, many lenders are still utilizing manual loan approval procedures that lead to slower decision times. To compete, you have to be able to say yes first and this can only be done by leveraging automation. This can be done by digitizing the loan application, implementing electronic signatures, or linking information between customers, databases, and applications.
Automation significantly enhances account servicing by expediting processes, minimizing errors, and improving the experience. Routine tasks such as closing accounts, updating account details, and requesting new cards/pins are typically burdensome for everyone involved. They typically require the customer to call or visit the branch to complete the process, but with automation you can create self-service portals and chatbots that can complete the requests without the manual labor of your staff, giving them back time to focus on more pressing matters.
Payment Collections and Recovery
Your collections team spends the day making collections calls, writing reminder emails for missed payments, and manually updating payment activities. Even the most efficient team still spends a large amount of time chasing outstanding invoices. When pursuing an automated collections workflow you can boost the morale of your staff, decrease the debt recovery time, and improve the overall efficiency of the collection process. Having features such as a self-service portal or a payment integration can make all the difference – studies show that automation can reduce the cost of manual data entry by 70%.70%.
Financial institutions are under more scrutiny and pressure from regulators and the reporting schedule is becoming more demanding. Manual reporting processes are more prone to human error and tend to be labor-intensive and time consuming. By leveraging automation technology, you can streamline multiple steps in your reporting workflow including:
This automation and lighten the workload and pressure your finance team may be experiencing while also improving the accuracy of your reports.
As consumers continue to embrace online banking, the threat of fraud continues to be a serious threat that can not only damage your reputation but cause significant revenue loss. A recent LexisNexis study reported that every $1 of fraud loss costs U.S. financial services firms $4. Fraud detection automation is the process of using software to identify and prevent fraudulent activities. Implementing this software into your core banking platform enables financial institutions to focus more time, effort, and resources on other operations knowing that all transactions and activities will be continuously monitored for any fraudulent trends or patterns.
Most customers don’t want to visit a branch or call to speak to a rep when they have a problem, they much rather try to resolve it on their own. Chatbots and AI-powered virtual assistants are great because they can handle large volumes of simple customer questions and complaints anywhere, anytime. These tools can provide fast responses, freeing up your staff’s time to handle more complex issues.
How Can Temenos Help
Temenos (SIX: TEMN) is the world’s leading open platform for composable banking, creating opportunities for over 1.2 billion people around the world every day. We serve 3000 banks from the largest to challengers and community banks in 150+ countries by helping them build new banking services and state-of-the-art customer experiences. The Temenos open platform helps our top-performing clients achieve return on equity three times the industry average and cost-to-income ratios half the industry average.
For more information, please visit www.temenos.com.