Hyperautomation in the financial domain refers to the integration of artificial intelligence (AI), machine learning (ML) and robotic process automation (RPA) to automate complex business processes, reduce manual interventions and improve operational efficiency. It has become critical to everyday operational activities. AI and ML are critical components of hyperautomation because they enable automation tools to learn from data and improve over time. With AI and ML, hyperautomation can process large volumes of data, identify patterns, and make predictions based on that data. This allows organizations to automate a wide range of tasks and processes, including decision-making, data analysis, and customer service. One of the key benefits of hyperautomation is that it can help organizations improve their efficiency and reduce costs. By automating repetitive and time-consuming tasks, hyperautomation frees up employees to focus on more strategic work. Additionally, hyperautomation can help organizations make better decisions by providing real-time data and insights. Components of Hyperautomation Let’s have a look at some of the altering hyperautomation processes that the financial domain has adopted – Account Opening and KYC (Know Your Customer) Hyperautomation has automated the entire account opening process including identity verification, credit checks, document processing, etc. The cherry on the cake is its ability to identify fraudulent applications and reduce the risk of financial crime. Hyperautomation has furthered this progress and today we also experience the ease of e-KYC where the entire journey along with the facial verification takes place online. Loan Processing The lending process was always considered a cumbersome process regardless of the amount of money one wanted to borrow. However, with hyperautomation, the process has not only become simpler but the disbursals have become quicker too. The redesigning of the loan processing cycle, loan application verification, eligibility checks, credit scoring, documentation, etc. has allowed banks and NBFCs to reduce their disbursal duration drastically since it eliminated several manual processes. This has additionally helped financial institutions better customer experience too. Risk Management Lenders have always been in the high-risk zone inspite of designing risk-averse strategies for themselves. With the introduction of hyperautomation, the scenario has changed for lenders. Artificial Intelligence (AI) and Machine Learning (ML) now analyze vast amounts of data to identify potential risks and provide insights to decision-makers. Moreover, it has also enabled real-time monitoring of risks allowing businesses to quickly respond to threats, fraudulent activities, changing market conditions and regulatory requirements. Customer Service Customer Experience (CX) has become an integral part of customer service. Experience is directly proportional to retaining a customer. With chatbots and voice assistants handling customer queries and grievances 24×7, services have become more personalized inspite of the reduction of personal touch. The Gen-Z prefers customization and personalization over personal touch and therefore, hyperautomation has been on the boom. To form an opinion, hyperautomation in the financial domain has the potential to transform the industry by reducing operational costs, improving accuracy, and enhancing customer experiences. It can also enable financial institutions to stay competitive by adopting the latest technologies and staying ahead of regulatory changes.
Tag: trends
The Future Of Online Banking In India
Digital banking in India is expected to grow with a CAGR of 23.1% from 2022 to 2030. NBFC growth is also estimated to hit $5 trillion in 2024. E-Banking existed as an additional service before COVID-19. However, after the pandemic, globally, the concept of Internet banking has changed. Indian banks have achieved phenomenal growth by adopting digital technologies. Banks hope to have a multi-dimensional relationship with customers to improve banking services. Upcoming Digital Banking Trends As digital banking continues to grow, it opens up new opportunities to reach the underserved market. Rural India has numerous small businesses and cottage industries that can thrive well with futuristic funding options. However, it was difficult for banks to reach out to those consumers. The following digital banking trends will bring financial services and products closer to the rural parts of the country as well: Mobile Banking According to a study, 89% of consumers use mobile banking services. Mobile wallets are also increasingly adopted by rural India due to the widespread growth of digitisation. Security is often a major concern for mobile banking users. Mobile banking has reached 5X growth compared to online banking. Mobile banking will gain even more popularity as the number of millennials and Gen Z customers increases. Emerging Trend Of Neobanks Neobanks are growing at a rapid pace in India. These neobanks operate digitally without any physical branches. They are great alternatives to traditional banks, offering innovative products and reaching out to underserved markets. Due to RBI regulations, Neobanks partners with traditional banks to extend customer services. BaaS The banking As A Service (BaaS) sector is causing major disruption in the fintech industry. Instead of building every service from scratch, it is much easier for NBFCs (Non-Banking Financial Companies) to set up Neobanks using the BaaS platform. The neobank technology stack can be customised according to the goals and needs of NBFCs. Partnering with a BaaS provider such as Niyogin, neobanks can offer services using the APIs. They can build on the infrastructure platform already complete with rails that can easily connect with rural customers. Innovative Technologies According to Insider Intelligence Survey, 66% of banking professionals believe that newer technologies such as Artificial Intelligence (AI), blockchain, and the Internet of Things (IoT) will positively impact banking by 2025. AI is now widely used in credit risk evaluation, customer authentication, and customer support. Blockchain technology will also help financial institutions cut down middlemen and reduce operational costs. Challenges For Future Digital-Only Banks Currently, RBI has a strict regulatory framework for digital banks. Digital banks must comply with liquidity standards and capital adequacy similar to commercial banks. Initially, these banks can get a restricted license, and after proving their efficiency, they can upgrade their license. To avail of digital banking services, customers need computer literacy. This is one of the main challenges for digital banks interested in providing services to rural India. Also, the need for secure banking services is also on the rise. The digital banking platform market is expected to reach $1485.5 million by 2028, from $776.7 million in 2021. Currently, 26% of Indians have a digital bank account, which is expected to grow in the future. RBI is also creating a closed sandbox environment for digital banking services. The budget has also carved some space for digital bank units, which is a clear sign of progression for the Indian banking sector. A fintech partner like Niyogin will help banking institutions easily transition from legacy systems to modern and advanced banking technology for futuristic customers.