Capital Markets Redefining Functionalities with Intelligent...

Capital Markets Redefining Functionalities with Intelligent Automation

By Capital Markets CIO Outlook | Tuesday, August 13, 2019

Capital markets adopt intelligent automation to gain a critical and competitive edge in the era of digitalization. 

FREMONT, CA: Capital market firms are now focusing on automation. Emerging technologies are expected to take over redundant and subtle tasks and create opportunities for higher revenues. However, the process toward optimization has already begun. Even though the technologies and their applications are still at an initial stage, many firms have been able to design smarter business processes. Intelligent automation, a mix of robotics process automation (RPA), and artificial intelligence (AI), is now becoming a key to the growth strategies for many capital market firms. According to studies, optimization techniques are going to be popular in the industry and revolutionize essential aspects and operations.

Legacy operations are time-consuming and inefficient. Intelligent automation can intervene in many areas and help companies overcome challenges. In every capital market firm, there are scores of applications that generate vast amounts of structured and unstructured data. To enable data movement, reconciliation becomes vital. Replacing applications requires time and capital expenditure, leading to operational inefficiencies. Long gestation periods add to the misery. Also, a change has to be accompanied by changes to the regulatory requirements. Hence, complex compliance needs also make functioning quite inefficient.

If a company wants to navigate through the above inconveniences and chart a course for maximum revenue, it has to undertake efforts to minimize operational inefficiencies. Digital technologies are the best way to achieve sustainable development in operations. One can now see that many companies are resorting to intelligent automation as it has proven advantages, and its applicability is high. Pilot projects that most firms take up before deploying technologies have given excellent results to companies, making RPA and AI highly desirable technologies.

In the areas of transaction reporting, reconciliations, and payment processing, there have been significant improvements over the last few years. There has been a reduction in transaction time and improvement to accuracy. The processes have come from being manual ones to automated ones resulting in labor cost savings. Additionally, work continues even during weekends and holidays without the need for any extra investments. Since virtualization can be scaled at ease, there are fewer risks of attrition. Also, unlike other disruptive technologies that require full-blown infrastructure developments, many of the intelligent automation features can be added to and integrated with the existing IT framework.

RPA is of considerable importance to customer relationship management. Customer onboarding wins big–time with RPA. A seamless, onboarding experience can attract and satisfy customers. Combining the functionality of multiple customer engagement channels with automation creates the best case for consistent contact. Scanning customer data to ensure compliance is crucial these days. Automating the checking and verification makes compliance full-proof with minimum costs associated. Practices of mortgage processing, and claims processing, when automated, also become smoother and faster.

Reconciliation at various stages of trade lifecycle, mandates vast amounts of data to be exchanged between systems. Automating the process of reconciliation enables accurate comparisons to detect data mismatch, thereby increasing productivity. The capital markets industry has to deal with clients through reports. Reporting can also be automated so that systems are entitled to accumulate information and generate a variance to make reporting more straightforward and faster.

Aligning data to make it more usable and resourceful is a direct result of automated analytics. Equipping machines with cognitive abilities make them highly optimized for decision making and so cross-selling, and up-selling improve. Overall, intelligent automation delivers three significant benefits to capital market operations: streamlined costs, enhanced control, and data analytics, without affecting the quality of service provisioning.

Weekly Brief