Five Use Cases of Intelligent Automation in Capital Markets

Five Use Cases of Intelligent Automation in Capital Markets

By Capital Markets CIO Outlook | Monday, December 28, 2020

As capital market barriers remain strong, the capital market industry should take advantage of opportunities to partner with FinTech companies to accelerate their digital shift and create creative solutions.

Fremont, CA: The capital market sector is experiencing radical changes, where businesses are adjusting to the digital shift and seeking to expand with FinTech companies' entry. In recent years, FinTech firms have significantly shifted the market share composition of retail financial services with their creative, cost-effective, and technology-focused solutions.

Today, the industry faces many challenges in complex evolving regulatory enforcement, massive systems with large amounts of reconciliation data, regular high system/application update caps, etc.

Five uses of intelligent automation in capital markets:

Customer Relationship Management (CRM):

More and more consumers are now engaging directly with digital systems, which offer the company many opportunities across various communication points to understand their customers better and enhance their overall customer experience. They can also be used on standard CRM tools such as Salesforce, Oracle, Microsoft Dynamics, etc. Intelligent automation systems fit well into such high-volume, repetitive and rule-based processes and can include account management, lead management, report generation, data synchronization, automated data entry, customer contract management, etc.

Robo Advisors:

These digital assistants may perform the role of financial advisors in the investment process by gathering information on the financial objectives of the investor, the risk appetite, the timeframe for the investment to recommend financial strategies, the allocation of portfolios, etc. These conversational AI-backed chatbots use big data and machine learning to understand their investor profiles, manage risks, and ensure regulatory compliance. These robot advisors can be used in a number of positions, such as investment advisory, portfolio analysis, asset management, and risk assessment.

Regulatory Compliance:

Government specifications for KYC, AML, and FACTA regulatory enforcement require firms to obtain, input, and process client data onboard. This can be a long-drawn, slow, error-prone operation. Automation of the KYC, AML & FACTA end-to-end phase with IA will speed up onboarding, provide valuable insights, and dramatically enhance the overall customer experience.

Corporate Actions:

Intelligent automation can extract data from corporate action announcements by using several automation levers together, such as RPA, Artificial Intelligence, Machine Learning, Natural Language Processing, etc. These can be used to automate several sub-processes such as notification of counterparties, allocation of dividends, payment of interest, measurement of eligibility and entitlement, etc.

Post-Trade Operations:

It is one of the most significant and essential elements of the life-cycle of trade. Post execution of trade from the buyer – the seller's hand, which must be balanced, reviewed to ensure no mistake or duplication of data occurs. Post-trade transactions involve multiple life-cycle procedures, such as authentication, payments & settlement, asset servicing, reconciliation, order reporting, etc. Using intelligent automation here will dramatically streamline processes and reduce back-office running costs.

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