Key Applications & Benefits of RPA in Finance for Modern Enterprises
Key Applications & Benefits of RPA in Finance for Modern Enterprises
According to a Gartner estimate, 80% of business leaders in the financial domain have (or are planning to) implement Robotic Process Automation (or RPA). It comes as no great surprise as RPA is known to save thousands of hours of manual work.
According to Computer Economics, 20% of organizations adopted RPA in 2021, an increase from just 13% in 2020.
Besides its use in the banking and finance sector, financial functions such as invoice and payroll processing are easy to automate using RPA.
McKinsey has previously estimated that 42% of all finance-related operations are ready for full automation. Financial robotics can work at least 20 hours daily to provide accurate financial forecasts and analysis.
So, what are the key applications and benefits of RPA in financial functions? Let’s discuss this in this blog.
Applications of RPA in Finance
Here are the common financial functions that organizations can automate using RPA technology:
As companies grow in size and revenue, invoice processing becomes one of the most time-intensive processes managed by the Accounts Payable department. With manual processing and human intervention, invoice processing is time-consuming and error-prone. Besides, customer-centric organizations fail to raise invoices in the desired formats with the correct information.
Using RPA, both accounts payables and receivables functions can automate their invoice processing tasks. For instance, powered by RPA, AI bots can scan and digitize relevant data from purchase orders to use in the generated invoices.
Along with invoices, finance and accounting teams must also manage various incoming documents associated with purchase orders and approvals. Besides reducing human errors, RPA-enabled tools can speed up document processing. For instance, AI-enabled optical character recognition (OCR) can scan text from paper-based documents. Machine learning systems can map the scanned data from the documents into the company’s records. Additionally, RPA-enabled tools can process documents received as email attachments or downloaded from online media.
Also known as payroll processing, this is one of the most crucial processes in any organization. On-time and accurate payrolls translate into satisfied employees, improving their engagement and productivity. Organizations operating from multiple locations and countries must adhere to local tax regimes to process salaries on time. It is both error-prone and time-consuming.
RPA technology automates payroll processing by tracking overtime, paid leaves, and taxes. It reduces operational costs and enables accounting teams to focus on high-value finance-related tasks.
Vendor contract compliance is critical for growing companies when onboarding new vendors and suppliers. Like employee and customer onboarding, vendor onboarding is prone to external risks like data breaches. Manual spreadsheets (or other processes) are an outdated vendor management mode. Besides being lengthy and error-prone, they are vulnerable to data breaches.
Using RPA, organizations can now automate the vendor onboarding process by measuring their market competitiveness and performance. For instance, RPA-enabled bots can quickly scan through vendor contracts and purchase orders to extract useful information like contract clauses, discounts, and tax rebates.
Next, let’s discuss some of the benefits of RPA in finance-related operations.
Benefits of RPA in Finance
In one of the surveys, 92% of respondents affirmed that RPA has met or exceeded their overall expectations. 90% of respondents were satisfied with the improved quality, while 86% reported improved productivity.
Here are some of the RPA benefits in the finance sector:
Cost and Time Efficiency
Among the major benefits, RPA implementation enables businesses to save their financial processing time and cost. Smart RPA-enabled bots are automating manual tasks like data entry and checking customer information, thus freeing up time from repetitive manual tasks.
Eliminating Human Errors
RPA is also the right answer for rule-based financial processes in insurance and mortgage companies. RPA-enabled bots can automate “search and compare” processes, thus eliminating costly human errors.
Improved Operational Efficiency
Using RPA in financial accounting can save up to 25,000 hours of work. It helps elevate operational efficiency, as less time is spent on daily tasks.
Scalability and Visibility
RPA tools can easily scale up to accommodate higher work volumes during peak business hours. It is easier than hiring a new team member in the accounting function. Besides that, by integrating RPA with existing financial accounting tools, organizations get 360-degree visibility into their financial processes.
What is the future of RPA in finance? Let’s discuss that next.
Future of RPA in Finance
The pandemic drove up the costs of maintaining the traditional manual approach to financial accounting and other functions. Organizations now need real-time access to financial data.
In the future, finance executives and business leaders are looking at the following functions on priority as part of accounting:
Improved data analytics
Strategic financial planning
RPA is regarded as the key technology to automate each of the above functions. RPA tools can enhance organizational control, automate various processes, and enable real-time data analytics.
On the cost front, RPA remains the best alternative to outsourcing finance-related operations. It ensures that data is not shared across geographical locations and that the operations comply with industry regulations and control frameworks.
Further, RPA implementation will help organizations refocus on the human workforce. RPA human specialists will need skills to train and manage RPA bots. They must be adept at analysis and decision-making to leverage RPA-delivered insights and assessments.
How Ellicium Can Help with RPA Implementation
At Ellicium, we help organizations with RPA consulting & assessment services, bot development & RPA implementation, automation architecture & infra design, and bot monitoring & automation support. Our expertise lies in various RPA technologies, including UiPath, Blue Prism, AutomationEdge, Automation Anywhere, etc. We provide cognitive automation that leverages both AI and machine learning technologies.
Over the past five years, we have deployed customized RPA solutions to recognize text from documents, including loan approvals, legal documents, and customer contracts.
With our cognitive automation service, our finance customers have benefited from the following:
Lesser manual intervention
Proper utilization of human resources
Here is a successful case study of RPA implementation for a leading financial auditing firm. The Ellicium team automated the CCAR regulations monitoring process, thus reducing the cycle time from 16 to 4 hours.
RPA is gaining widespread adoption across industries, including banking and manufacturing. With their numerous manual processes, financial functions are also ripe for digital transformation enabled by automation. At Ellicium Solutions, we have provided RPA services to our global clientele. You can leverage our technical expertise and experience to begin your RPA journey today. Contact us today.