Among the many promises that make digital transformation so enticing for financial institutions, one that gets perhaps the most attention is the promise of “frictionless” processing. Let’s think about what “friction” really means, and where – despite years of digital progress in bank operations – it continues to exist.
Generally, friction is a term used to described elements in an operational workflow that require human intervention – where the digital collides with the non-digital – and therefore can’t move with the speed or efficiency we’ve come to see as ideal. It can be said to occur when an account officer requests and reviews corporate formation documents for a small business account opening, or when a mountain of mortgage documentation must be reviewed, identified and validated as part of originating or acquiring a mortgage loan, or even when lending executives must consider a myriad of complex variables in making a loan approval decision. Great strides have been made in the continued elimination of friction. Powerful workflow automation and RPA tools that can be configured by business analysts are becoming the standard. Decision automation tools can increasingly mimic the best in human decision making.
One element of bank operations, however, has stubbornly resisted the march to frictionless operations – that element being the management of unstructured content. Especially in light of increased requirements for institutions to “know your customer,” the demand for collateral content in support of bank relationships and transactions has skyrocketed. This content is received in every imaginable form, from paper, to fax, to email, to PDF or image file... And the effort expended by organizations in requesting, receiving, understanding, labelling, extracting key information from, and archiving unstructured content remains undoubtedly the most persistent source of operational friction today.
This is what makes the topic of “Intelligent Capture” so compelling. The ability to look at a document and simply, intuitively know what it is. The ability to discard content that is clearly erroneous or irrelevant. The ability to capture the sentiment behind a piece of customer correspondence and proceed accordingly. The ability to identify and extract key data elements in a multi-paged, complex document. These are use cases that until now have been too complex for automation, and therefore remained central drivers of costs, delays, errors and compliance failures.
Intelligent Capture has the power to eliminate all of these friction points—and more—enabling institutions to streamline core functions, reduce costs and dramatically improve the customer experience.
By applying artificial intelligence, Intelligent Capture can effectively automate the extraction of valuable information from unstructured documents, a process that can be further optimized with robotic process automation, workflow and decision management—without replacing existing legacy systems.
Let’s take a look at how this concept works in the real world. Here are five of the many ways Intelligent Capture can benefit financial institutions, and the impact made on actual Imagine Solutions customers.
1. Close More Loans, More Quickly
Like most banks, this client wanted to move its loans from application to close more quickly, but, its paper-based processes blocked progress.
Every day, a courier service transported paper loan documents from its various branches to a centralized operations center for manual processing. Not only did this slow the process down, but added significant costs—a tough combination in a low-margin finance world.
Now, after documents are scanned at the branch, the Intelligent Capture system automatically classifies each document type, extracts the appropriate information and routes it to the proper workgroup for processing. If something is missing, the loan officer is automatically notified for fast resolution.
As a result, the bank reduced loan cycle time by 70 percent and decreased operations FTE by 20 percent.
2. Grow Mortgage Servicing Business While Reducing Costs
This mortgage servicer wanted to grow its business, but, was struggling to manage the volume it had. Its purchased loan portfolios included large image files for multiple loans with hundreds of different document types. The staff had to manually separate and index the documents, as well as identify any missing information. No matter how many people the company threw at the problem, the backlog continued to grow.
By implementing an Intelligent Capture solution, this mortgage servicer converted its backfile of more than 1 billion pages to text-searchable PDFs. New portfolios are now automatically classified by document type, checked for completeness and validated, with minimum manual intervention.
This servicer reduced loan acquisition times and FTE costs, and is now positioned for growth.
3. Streamline New Account Opening for a Better Customer Experience
These days, the customer experience is everything, but this bank’s new account onboarding was anything but easy. New customers filled out a paper form, with copies of their photo ID, social security card, proof of address and signature card attached. Then, these documents were shipped to a centralized operation for manual prepping, scanning and indexing. If something was missing, the customer has to trek back to the branch with the document.
Now, with an Intelligent Capture solution, everything is automatically scanned, indexed and verified at the branch. The customer even has the option of uploading documents remotely.
The bank reduced labor costs by 50 percent, decreased new account processing time and made new customers a whole lot happier.
4. Simplify FDIC Part 370 Compliance
FDIC Part 370 requires that every insured depository institution with two million deposit accounts maintain accurate information to determine deposit insurance coverage for each of these accounts. Joint accounts don’t qualify if signature cards are missing or haven’t been signed by all joint account holders. The challenge is, the requirement is retroactively enforceable,so, banks have to find a way to quickly go through their archives to identify accounts with missing signatures, or risk non-compliance.
By implementing an Intelligent Capture solution to import documents, classify archived signature cards and identify missing signatures, an Imagine Solutions customer was able to avoid the costs and complexities of manually sifting through millions of documents. As a result, they met Part 370 compliance requirements ahead of deadline without excessive overhead costs.
5. Close More Indirect Auto Loans, Faster and Cheaper
This bank was receiving 1,000 new indirect auto loan funding packages daily, and was struggling to keep up—even with a large team of people manually classifying and indexing documents.
With a new Intelligent Capture solution, this Imagine Solutions client could automatically classify, extract and validate the necessary information from these documents. As a result, they reduced the number of FTEs needed for processing by 90%, and were able to double their loan volume, without adding staff.
These are only a few of the ways Intelligent Capture can benefit institutions of all sizes. To find out more about the solution and more detail on these case studies, please watch a replay of our webinar, Five Ways Intelligent Capture can Drive Value in Your Financial Institution Today.