Written by: Alberto Iglesias Fraga, journalist specialized in digital economy.
The immediacy and ease of use are only a couple of the great advantages the ‘fintech’ revolution has brought to our lives. Actions seemingly so natural, such creating a bank account taking a ‘selfie’ or asking for credit on a mobile app, were things we simply couldn’t imagine not so many years ago.
However, has this modernization really caught on the base of financial processes? Even though we are apparently, from the final consumers point of view, dealing with 100% digital applications, the reality is that everything which occurs behind has not evolved as much as the packaging shown to the user. Perhaps the best example of this can be found when one of these fintech apps asks us for documentation to identify us conveniently, or to validate our risk level when asking for a loan: for the client, there is no human interaction at any moment; however in the back office we can find skin and bone workers checking each file to make sure everything is ok.
Is it sustainable to maintain so mechanical processes in such an agile and demanding era as nowadays? Can an approach in which we have a fully digital front-end but perpetuate analogical models in the business’s heart be sustained in the long term? The answer, just as the financial industry is beginning to prove, is absolutely no. At least not if we intend to have the most efficient job process and management possible.
Due to this, each time more companies in this sector integrate RPA technologies (Robotics Process Automation), capable of executing administrative steps in an identical way to a human user. With this type of software, repetitive processes in finances, accounting, human resources, supply chain management or customer service can be automated. Systems which, additionally, blend in perfectly with the different user interfaces and job processes existent in companies.
In banks or insurance companies we can use RPA to validate the documentation the clients present via online channels, either through the optic character recognition of those (with OCR technologies which recognise the characters on an ID card, among other possibilities) or with crossed validations (integrating other information sources such as public databases of information originating from the actual companie companies files).
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However, the most interesting point is that, once the data authentication has been carried out RPA helps all the work process to be monitored in order to avoid incidents and bottlenecks in the workflow. In this way, thanks to task automatization we can improve the way information flows along each stage of the value change, fully monitoring the compliance of each of the actions to be performed. This is an elemental first stop to bring the concept of “digital factory” into the financial management environment: just like they make sure a screw is correctly fitted in at a production plant before passing on to the next level, in fintech the same approach can be applied when carrying out their tasks.
To set an example, imagine what the processes required to grant a credit with solutions based on RPA and the digital’ factory, such as Addalia’s IDDILIGENCE and IDDILIGENCE Factory, are and could be like. In the non-digitized back office the client provides his documentation to the entity, the workers validate that information by hand and begin to carry out each of the steps (handing over the contract, requests for additional information, etc.) in a traditional way, with hardly any control over its compliance or the amount of time employed for each stage. On the contrary, with digital factory solutions, the data provided by the user is automatically verified and validated (even with third party sources such as databases of debtors or the Mercantile Registry) generating the risk analysis in an autonomous way within a few seconds. Then the system will monitor the completion of all the necessary work flows (either attended by workers or non-attended) to close the loan, from the delivery of the contracts to ensuring that they have been sent back to the office with the clients signature.
The same happens in other everyday situations, such as registering a new account (even fully digital and popular apps like Revolut use human verification to identify their clients, causing huge delays when they have a lot of demand) or in processes with a longer lifespan, such as those related to foreign trade, when the monitoring of the workflows becomes essential to release withheld payments as the merchandise arrives.
Apart from managing to reduce decision-making while granting a loan for something so simple as financing an electrical appliance (favouring client acquisition and avoiding clients to back out at the last moment while buying a product), tools like Addalia’s IDDILIGENCE Factory, also allow us to ensure that all the elements and operations are correct and have been carried out with no human errors or data leakage.
Even more: throughout RPA technologies we can make sure that a bank or an insurance company complies with all the legislative requirements imposed by Administration. Compliance, one of the most critical aspects in this sensitive industry, is difficult to guarantee without a digital monitoring in each phase of the workflow, with a tool which allows us to govern all the client’s information and verification tools capable of avoiding scams while identifying the client or the different documents they hand over to justify their financial activity.