Financial Risk Management with Intelligent Automation

The Banking, Financial Services and Insurance (BFSI) sector has witnessed a slow yet impactful growth on the digital transformation front. Modern technologies like Artificial Intelligence (AI), Robotic Process Automation, Machine Learning (ML) and Intelligent Process Automation (IPA) have acted as the harbingers of this transformation. A recent survey found out that 85% of financial industries (FI) have already implemented A.I., and an additional 77% of these respondents also believe that AI will play an integral role in the industry, in the coming 2 years.

This also means that AI will have a massive impact on financial risk management in the future. A study suggests that by 2025, risk functions in the financial industry will likely be fundamentally different than they are today. The study goes further to state that, the next 10 years in Financial risk management may be subject to more transformation, in comparison to the last decade. Therefore, it’s imperative for FIs to prepare for long-term and sustainable changes, in order to avoid getting overwhelmed by future risk management demands.

The Role of Technology in Strengthening Risk Management

As technology evolves and becomes more nuanced, so do business operations and financial technology. But it doesn’t stop there. In the shadows lurk advanced ways of financial crimes and fraud. Thus, to keep up with current fraud practices, it is crucial to have an advanced solution in place.

With Intelligent Automation (IA), a synergy of AI and RPA, and ML you can establish a robust and sustainable financial risk management solution for your business.

Here are a few ways in which advanced technology can do so and prepare your enterprise for any future disruptions.

  • Improved Compliance Regulation

RPA, a rule-based tool, can process high volumes of structured data, in no time. This entails, application processing, customer onboarding, data validation etc. This liberates your human employees from mundane and mind-numbing tasks and allows them to focus on more value generating tasks.

Substituting RPA for such tasks eliminates any risk of human errors; saving your company thousands of dollars from compliance fines. Deploying compliance officers for compliance regulations like Know Your Customer (KYC), Anti-Money Laundering (AML) and Customer Due Diligence (CDD) can be very expensive and time consuming. RPA with AI can save you a lot of time and capital, by automatically verifying all of your customers’ data. It does so by scanning every available database on the internet that validates the customers identify and qualification. It also improves data quality and minimizes process time, making headway for faster loan processing.

  • Automated Fraud Detection/Prevention

With majority of industries now working on cloud, given its easy usability and limitless scalability, there are now higher risks of online data breach and fraud. This is why many financial enterprises are already utilizing or are planning to utilize AI in fraud detection and prevention.

AI provides your enterprise with the ability to scan all your siloed cloud infrastructures. This aids in swift analysis of your confidential data as well as customer behavior, on cloud. Through these analytical data you can easily detect abnormal cloud interactions and predict data breaches in advance.

Furthermore, ML can learn from previous fraud patterns and automatically detect them in future transactions. ML and AI can work together to identify unusual patterns and behaviors that humans can’t, building your business a robust fraud detection/prevention solution.

  • Credit Risk Management

A strong credit risk management system, powered by AL and ML, can mitigate risks and provide crucial actionable insights. While traditional credit risk management procedure can take up to 3 weeks, AI-ML powered solutions can do the same in a few minutes.

AI and ML can quickly scan through documents and analyze the customer’s credit score, financial state, market ecosystem etc. to provide insightful risk prediction. This allows your enterprise to effectively minimize their overall credit loss.

With newer compliance regulations being introduced every year and increased cybercrime, it’s crucial for your financial enterprise to invest in an advanced and disruptive technology like IA. The complete IA or IPA solution can be built and deployed injust 4-6 weeks, saving you a lot of time and capital. When implemented for feasible use cases, it typically reaps triple-digit ROI.

If you are interested in exploring other aspects of IPA that can benefit your enterprise, you can read about Streamlining Mortgage Processing, Banking & Financial Services with Intelligent Automation. Alternatively, you can also read Accelerate Mortgage Processing with Game-Changing Intelligent Process Automation (IPA) Solutions. If you’re interested in exploring Intelligent Automation to enhance your firm’s mortgage processing, Rapid Acceleration Partners would be glad to help. Our next-gen, AI-powered content intelligence platform RAPFlow enables full lifecycle AI orchestration on a single platform. When used in tandem with our RPA tool RAPBot, it provides end-to-end workflow automation capabilities that can be deployed in just weeks. You can even build your own use case and the platform can easily integrate with your existing systems. Book a demo to get a more detailed understanding of how our products can transform your business.

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