Here's why banks need intelligent automation. Source: Shutterstock

Here’s why banks need intelligent automation. Source: Shutterstock

IDC explains why banks must pay attention to intelligent automation

OVER THE PAST couple of years, banks and financial services institutions have been exploring how they can deliver better products and services to customers and smarter solutions to their employees. using technology.

Their biggest challenge, as frequently discussed by consultants, is the legacy infrastructure that they’ve built their core systems and applications on. However, most seem to have found a way to overcome that — usually by using automation in some shape or form.

In fact, many organizations are beginning to combine simple, script-based automation with artificial intelligence (AI) and machine learning (ML), in a bid to take their digital projects to the next level.

“Equipped with innovative tools and rapidly evolving technologies, the industry is now intent on achieving hyper-scale and hyper-performance with an ‘intelligent digital workforce'”, IDC IDC Financial Insights APAC Lead Analyst for Intelligent Automation and Artificial Intelligence Sneha Kapoor explained to Tech Wire Asia.

Intelligent digital workers are essentially software robots that can perform both deterministic and non-deterministic tasks by continuously understanding and analyzing structured and unstructured data.

They represent rules and judgement-based automation, and, like their human counterparts, are both self-learning and self-healing workers that can discover patterns to predict decisions and even offer recommendations to improve them.

In other words, the intelligent digital workforce is progressively graduating from merely mimicking human actions to augmenting human intelligence, as well as evolving quickly to achieve the potential of autonomously emulating this intelligence.

Kapoor pointed out that some of the key enabling technologies for intelligent digital workforce solutions are:

  • Message-oriented middleware
  • Robotic Process Automation (RPA) software
  • Application Programming Interface (API) management
  • Predictive analytics
  • Business process management
  • Workflow management and content management
  • Streaming integration
  • Screen scraping and optical character recognition (OCR),
  • Cognitive/AI, rules engines, and data management

While banks and financial services institutions are comfortable with the idea of automation and some have successfully deployed and scaled RPA solutions across the enterprise, intelligent automation still seems like a distant concept.

According to Kapoor, most of the automation deployments in APAC financial services institutions have been for less than 15 processes.

In comparison, simple RPA at India’s ICIC Bank, for example, has seen enterprise-wide adoption, deploying about 750 RPA bots that handle close to 2 million transactions per day.

“These robots are being used across different operations and LoBs including retail, wholesale banking, forex, treasury, agro and international operations. And most of the robots deployed have been developed in house,” ICICI Bank India’s Senior GM and Head of Operations Anita Pai told the media.

On the other hand, Kapoor, who regularly educates, advises, and supports banks with their intelligent automation projects believes that a siloed, piecemeal approach to automation is still more common than an enterprise-wide strategy — which is one of the reasons many institutions have not been able to scale their deployments.

“Moreover, many early adopters that tried to instill cognitive intelligence in the automation of their business processes have not been able to deliver steady and accurate results or justify ROI from these deployments,” Kapoor explained.

However, IDC expects to see more and more banks and financial services in the APAC recognizing that a piecemeal approach to automation will only accrue limited results and in some cases, even outright failure.

This acceptance has encouraged management and business teams to expand these deployments from a single team or few teams to an enterprisewide scale.

In addition, IDC recently highlighted a massive change in the perception of capabilities of RPA tools and a greater realization among institutions that RPA is an essential step toward achieving a more successful intelligent automation.

For all these reasons, Kapoor explained, there is a rapidly growing demand for an automation solution that can offer a single unified platform with a centralized view and management of enterprise-level automation across various IT systems and technologies.

In the next two years, IDC believes that there will also be more investments from financial services institutions in establishing centers of excellence (CoE) to drive best practices in automation and enable a more robust management and control, security and audit, and overall governance in the intelligent automation space.