Business Process Automation For Financial Services Firms- Page 3

When you think of particularly paper-intensive businesses, chances are, banks and insurance companies come to mind. Financial services organizations are traditionally paper-based, meaning the processes that drive their businesses begin, and sometimes end, with manually completed paper forms.

From a customer perspective, setting up a new account, initiating a claim, or applying for a loan are time-consuming, needlessly complex tasks involving reams of paperwork. These applications are also cumbersome, inefficient and costly for financial organizations themselves. The sector’s continued reliance on slow, manual tasks seriously frustrates its clients, which results in low overall customer satisfaction, loss of business, and diminished productivity.

Is it any wonder that, due to strong competition for clients, and government legislation, financial services firms are looking to automate business processes and bring their services online?

Customer touchpoints for financial services companies encompass a broader scope than just dealings with traditional consumers. Consider the various ways a bank or credit union interacts with all of its stakeholders via processes that could be automated:

  1. Bank-to-bank/business
    New accounts, treasuries management, loan origination, wire transfer, compliance filing.
  2. Bank–to-consumer
    New accounts, change requests, problem resolution, loan servicing, consumer self-service.
  3. Bank-to-government
    Compliance filings (S1, 10K, 10Q), SARS filings, Student loan servicing, FDIC reporting, NASD filings, and compliance with legislation (Patriot Act, Gramm-Leach-Bliley Act).
  4. Bank-to-employee
    Performance management, benefits enrollment, employee change of status, procurement applications, leave/travel requests
Best Practices for Business Process Automation

In looking at the above, it is clear there’s no shortage of processes that could be streamlined. By eliminating paper-based processes at their start, financial services organizations have an opportunity to greatly improve the speed and accuracy of interactions with consumers, governments and businesses, thereby creating a significant competitive advantage.

The true challenge is translating the idea of improved processes to a reality that works within the day-to-day operations of a financial institution. In automating business processes, organizations need to do more than put forms online. There needs to be a thorough examination of the existing processes and a focus on developing an intuitive system for users. It is for these reasons that electronic forms or e-forms have emerged as a best practice within the financial services market for making the move to automated business processes.

Usually, these processes can be formally defined – they have a known start, middle and end with possible paths between them. Each transaction in a process may be thought of as moving from one point or “state” to another. For example, an insurance claim may be initiated by a policyholder, received by an agent, then approved or rejected by an adjustor. An XML e-form can hold the transaction’s “state” information. Through its business logic, it will know if the form represents a blank template, an initiated claim or an approved claim. This knowledge comes from the data it contains.

To meet the unique needs of the financial services market, XML-based e-forms are increasingly becoming the interface to, and facilitator of, automated business processes. By capturing transaction information – structured and unstructured – in an electronic format, managing it through a completely digital workflow, and archiving it in dedicated content management systems, organizational efficiencies can be achieved. Together, these complementary technologies enable business processes that integrate people, systems and data to form a platform for capturing, linking, routing and managing information as it moves through a business process. Financial services organizations with an investment in e-forms and/or content management can enhance their value by using both to automate and streamline complex processes.

Financial services organizations that have committed to business process automation have been able to achieve significant and meaningful business benefits including increased efficiency in processing transactions across business systems, greater employee productivity, an overall increase in operational efficiency, reduced operating costs, and improved customer service. In the highly competitive financial services market, it is clear that using business process automation technology can provide a substantial competitive advantage in all areas of operations.

Automating Routine Tasks: A Real-Life Example

Hundreds or even thousands of wire transfers take place between banks around the world every minute of the business day. There are routine transactions that, with the right technology, financial services organizations have been able to fully automate.

Here’s a real-life example of how a major full-service bank was able to eliminate manual paper-processes and automate wire transfers:

The financial institution, with assets in excess of $6 billion, 36 branches, and more than 2,000 employees, used a manual paper-based process for wire transfers involving large sums. The process was complex due to required approval controls. The existing manual system was time-consuming, error-prone, and required an extra business day to complete such transfers.

Using form-based business process automation technology, the bank fully automated its wire transfers and implemented a completely paperless system that eliminated the possibility of errors and human intervention in the process, while dramatically reducing the time required for a transfer to move from the teller to the Federal Reserve’s FedLine System. With the successful implementation of the technology, requests are now completed the same day, with every step in the process tracked and all actions accurately recorded.

The bank’s new wire transfer request process ensures that every transaction is secure and complies with government rules and regulations. The bank’s system was also greatly enhanced through the use of electronic signatures. The end result for the financial institution is a faster, more accurate process that has greatly increased the productivity of bank employees by ensuring that wire transfer requests can be completed on the same day without sacrificing security and risk controls.

Here’s another example of how a simple automated process yields maximum results.

SEC Implements Business Process Automation

Before process automation, all filings made to the Securities and Exchange Commission (SEC) were on paper. Trucks delivering copies of documents snarled traffic in busy downtown Washington, D.C. for miles as they tried to meet filing deadlines. Documents were photocopied and hand-delivered to reviewers. Documents sometimes disappeared.

The SEC’s EDGAR system (Electronic Data Gathering, Analysis & Retrieval System) accepts regulatory documents over the Internet. The system performs automated collection, validation, indexing, acceptance and forwarding of submissions. Its primary purpose is to accelerate the receipt, acceptance, dissemination and analysis of time-sensitive corporate information. EDGAR was being stretched to its limits – with 12 to 16 million pages of documents received annually from more than 28,000 individuals and corporations.

To meet this growing strain, EDGAR was modernized using XML e-forms and the Internet. Using XML as the filing format ensured maximum data sharing while providing transparency to end-users. Forms are downloaded from the EDGAR Web site, completed, validated, digitally signed, and securely submitted to the SEC. The XML-based e-forms system enabled the SEC to simplify processes internally and with document filers and the investment community. The system has reduced costs for its users and greatly improved service by making filing faster and easier than ever before. Furthermore, government paperwork elimination legislation was met, security was protected, and legal and regulatory compliance was maintained.


By automating business processes, financial services organizations can reduce costs, cycle time, user frustration, and input errors, while at the same time increasing speed of transactions, productivity, information integrity and access to relevant information. Within automated business processes, information flows seamlessly through the organization, minimizing the number of steps needed to complete a transaction and the amount of time spent manually entering, correcting, and searching for data. Presenting and receiving process information in an intelligent, user-friendly manner ensures that information is captured right the first time, decisions are made correctly, and process integrity is maintained from start to finish, across the business and externally to customers, partners and other parties. The result is an efficient, productive, smart and competitive business.

About the Author

Mandy is part of the management team at PureEdge Solutions. She can be reached at

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About PureEdge Solutions

PureEdge Solutions is an enterprise software company providing a business process automation framework that enables governments and business to lower costs and improve efficiency by delivering the right data to the right user at the right time. For more information, visit