Indian banks achieve productivity gains with RPA

Indian banks have been early adopters of RPA, benefitting from productivity gains, higher accuracy and cost-efficiency

Indian banks achieve productivity gains with RPA - CIO&Leader

Intelligent automation and RPA, in particular, is driving efficiencies for enterprises, resulting in dramatic productivity gains in the back office and enhanced customer experiences in the front office. The RPA momentum over the last couple of years has remained unabated even in the face of economic pressures from COVID-19, prompting Gartner to predict that the global RPA market will continue to grow in double-digits through 2024.

RPA is nothing but software-based automation that mimics human behavior to perform rule-based transaction processing such as logging into multiple applications and collating data. Although many sectors have adopted RPA, nowhere is the momentum more evident than banking and financial services. One of the most tech-savvy segments, RPA adoption has streamlined a wide variety of processes and changed the face of banking—an industry that is laden with routine, volume and time-intensive processes.

Banks have significantly benefitted in automating underwriting—a crucial yet tedious and error-prone process for loans which require information compilation from multiple sources, making it an ideal use case for RPA deployment. Another area of impact is in meeting statutory and compliance requirements as RPA automates manual processes for frequent reporting and disclosures, while retaining audit traits of processes to reduce risk.

Indian banks have been early adopters benefitting from productivity gains, higher accuracy and cost-efficiency. HDFC and ICICI Bank, for instance, have adopted RPA as early as 2016 to automate a range of processes.

The Operations Department at ICICI Bank deployed RPA for 10 processes which went up to 200 processes during the first year itself to support multiple businesses—such as retail, corporate, treasury, agri-business, trade and forex—executing more than 10 lakh transactions per day, reducing response time by up to 60% and 100% increased accuracy. Today, ICICI bank has automated 1350 processes to onboard customers, process loans andperform reconciliation with 750 robots processing more than 20 lakh transactions per day.

HDFC Bank, a close competitor of ICICI Bank, has reduced the loan processing time by 50% using RPA, directly impacting its ability to process more loans. Now loan processing is executed at a central location, visible in real-time to all credit administrators, enhancing productivity by 12%. Another interesting customer engagement deployment at HDFC is its Electronic Virtual Assistant called EVA, an AI-based intelligent chatbot, which can assimilate data from multiple sources and provide solutions in 0.4 secs.

Productivity gains with RPA enablement at State Bank of India have been pegged at 700 hours per day across processes. SBI Card used RPA for transaction dispute follow-up process which significantly reduced human errors and increased process efficiency while enhancing customer experience. This is now being extended to eight processes and the learnings have enabled standardization bringing in further efficiencies. SBI will now implement RPA in other business functions, such as finance, HR and IT. 

About 40-45% of personal loans at Axis Bank are sold via digital channels wherein advanced analytics play a key role in identifying credit worthiness of applicants while robotics automate manual processes at the backend. All inward clearance functions at Axis Bank are achieved via automation using RPA and AI.

Going forward, RPA and intelligent automation will play a crucial role in powering the Indian economy as more organizations adopt intelligent automation at scale, creating more high-skilled jobs and providing economic opportunities for everyone. According to a study by Ernst & Young, automation is driving intrinsic growth in every sector of the Indian economy, catapulting it from USD 2.7 trillion to USD 5 trillion economy in the next five years.

RPA is changing the rules of the game as organizations are finding new ways to deploy automation in everyday tasks. Specifically, when RPA is combined with AI and analytics, organizations are empowered to re-imagine processes and trigger significant shifts in business operations and customer experiences.


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