How smarter business solutions can bolster financial services companies

The legacy financial services industry has seen startups in financial technology (FinTech) chip, chip, chip away at its customer base. And many see the new competition as a threat. In its latest Global Fintech ReportPwC validated this sentiment: A whopping 88 percent of legacy banking organizations fear losing revenue to FinTech companies. This spans across payments, money transfers and personal loans—and puts an estimated 24 percent of revenues at risk.

Naturally, most of us want to be efficient with our time and money in every aspect of our lives. In that spirit, the rise of FinTech services offer consumers the benefits of automation. Thanks to abundant technology around us, the traditional financial services industry has the chance to leverage smart solutions to improve their business processes. That leads to self-service, real-time engagement and omnichannel support to combat FinTech competitors with a dose of their own medicine: innovation.

The case for case management

Legacy banking organizations struggle to keep up with consumer expectations due to a crippling influx of documents and customer provided content. This begs for stronger case management strategies—but also holds the key to successful competition with FinTechs.

More packaged, solutions-based approaches meet this need head on.  Gartner and Forrester Research have devoted copious research to case management platforms. Yet the process­es involved are not monolithic, and this distinguishes case management from more traditional business process management (BPM). They cannot simply be mapped out from beginning to end as a single process.

A “case” typically undergoes multiple smaller process “fragments,” where the sequence is not always predeter­mined. The move to invoke a certain process frag­ment is often made by a knowledge professional, based on their tacit understanding of the case rather than an easily defined business rule.

Consider, for example, an online application for credit where the names on the driver’s license and credit bureaus differ. A knowledge worker would intervene to discern the reason rather than allowing the system to automatically decline the application.

Case management also underscores the transition of work from task-driven to knowledge and context driven. This means knowledge workers can streamline rather than stagnate in routine customer service production tasks, investigations or non-routine incidents.

While currently an adolescent technology with only 5 to 20 percent adoption, case management is expected to go mainstream by 2020 to 2025, according to Gartner. However, as self-service transactions increase among financial institutions—compounded by channel diversity and the need to understand context with expanded data relationships—exceptions will continue to remain. These will also get harder to anticipate and resolve, according to Forrester.

Another smart move: Intelligent capture meets compliance

Regulatory compliance burdens force institutions to examine their internal processes to ensure optimization for a new regulatory landscape and also yield more data and information to make better, timelier decisions. With the use of case management platforms, financial institutions can maximize intelligent capture solutions to protect their reputation. That means the ability to do the following:

  • trace data
  • assign data confidentiality levels based on meaning
  • complete full audits, and
  • detect and prevent fraud

Likewise, intelligent capture and automated process can now integrate into existing platforms to streamline daily operations such as opening accounts, credit card application management, and loan and mortgage processing. They also take on more strategic processes as well –where financial institutions can wield the power of case management and automated intelligent capture.

Consider the reselling of mortgages, for example. This secondary market allows lenders to free up capital to sell more mortgages, even as they divest themselves of the risks associated with non-payment—passing that on to the new purchasers of the mortgages. As a result, those that purchase existing mortgages need to conduct a complete, thorough investigation of what they purchase: often a tedious and costly, document-based task.

Similarly, loan/line of credit origination also requires financial institutions to exercise a greater level of due diligence vis-a-vis financial details of prospective customers. Income and identity verification often come in the form of paystubs, tax records and other relevant documents. The information they contain must be understood, validated and cross-referenced against the declarations contained within the original applications.

Digital decisions, faster financial insights

Financial services organizations must leverage intelligent automation solutions that enable knowledge professionals to make quick, informed decisions—and also enable smarter customer solutions such as self-services. PwC found that most financial institutions focus on updating legacy systems with emphasis on digital solutions that can integrate to improve operations. Natural language processing (NLP) technology represents one example of how knowledge workers in the finance industry can extract insights and intelligence from unstructured text and thereby transform data in financial records into useful, actionable information.

NLP tools can automatically provide financial institutions accurate access to key entities—such as persons, organizations and financial instruments—together with events and facts. This accelerates decision-making processes similar to those involved in mortgages and loans. Accelerating the speed of financial transactions will satisfy the demands of today’s consumers without sacrificing regulatory compliance or cost containment.

Ultimately, this also positions financial companies for short and long-term success and boils down to a simple fact of life: For many banks, intelligent automation represents an intelligent, automatic move.

Bruce Orcutt is vice president of marketing at ABBYY’s North American Headquarters. ABBYY is a global provider of document recognition, content capture, and language-based technologies and solutions for business.