If you are a mid to large sized organization you are aware of the time spent on manually checking and matching transactions, preparing, and posting journals to complete bank reconciliations. And these tedious tasks are done on a weekly or daily basis depending on the size of the enterprise. It can be an intimidating task considering the number of transactions generated in a day.
The rising trends in online purchase have also led to a direct increase in the number of digital transactions. It is a no brainer that it is impossible to manually check and verify the transactions and perform bank reconciliation process without a glitch. Many organizations have used excel to make the process easier and aid in manual checking process, but it is now obsolete.
To push through the maze of increasing transactions, the speed at which the transactions are generated combined with the various modes of digital payments, companies must adopt Intelligent Process Automation as their first line of defense. It is more important than ever to ensure that you receive error free real time updates.
Evolution of Bank Reconciliation Solutions
Manual- In this obsolete method, the accounts were checked and verified manually. But this is no longer valid as volumes have increased and payments are being made digitally.
Spreadsheet based– Spreadsheet based reconciliation was the first tool used in the step up from manual processing. It still took a considerable chunk of the personnel’s time who had to manually add up the results and deal with the mechanics of the spreadsheet.
Rule Based and Hosted– These software solutions partially automated the reconciliation process. The number of errors was reduced and so was the time taken to complete the recon.
IPA – AI based solutions were introduced to overcome the drawbacks of the rule-based solutions. The ML helps to mix and match data and identify patterns across the input. AI based recon solutions can also perform Exception Handling, a key recon process which is entirely manual currently.
Automation of banking reconcilation has been due for a long time now. The automation of data intensive and high-volume process like this is necessary to eliminate roadblocks and ensure a smooth back-end operation. It can help to consolidate transactions from different sources, aid in collaboration of different systems and ensure that the routine transactions are verified with minimum human intervention. Processing daily transactions will help the ML component of hyperautomation to understand newer details and assimilate them into future reconciliation process.
Employing IPA can cut the time taken to complete bank reconciliations by 80%. With IPA in place, the entire bank reconciliation process can be automated with Artificial Intelligence (AI) handling the processing of various formats of unstructured content and Robotic Process Automation (RPA) mimicking human actions that bridge processes for end-to-end automation.
Why should you automate bank reconcilation?
- The Work from home mode has also impacted the bank recon process in the last two years. With a majority of the employees working from home, it is not possible to ensure the highest degree of quality control. In such a situation automation can help to reduce the dependency on human workers and ensure better efficiency.
- Even a minor error in bank recon can result in financial losses. You can turn to automation to avoid costly errors and deliver enhanced customer experience.
- 24/7 monitoring of bank reconciliation is imperative to detect fraud and eliminate cash flow leaks. It is essential to check the validity of every transaction, either by human or machine.
- The earlier the transactions are reconciled the better, as volumes can be intimidating and lead to fatigue, followed by error.
- Proper reconciliation of bank accounts is essential to ensure Proper tax returns as well.
Advantages of Automating Bank Reconcilation
- Streamline process
- Remove key person dependencies
- Standardize reconciliation process
- Minimize errors
- Improve employee satisfaction
- Provide transparency in financial transactions
- Availability of real time financial data to aid in critical decisions
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.
Tags: #FinancialRiskManagement #IPA #AI #IA #RAP #ML #RAPAI #hyperautomation