RPA & Fintech Use Cases
Regulatory Transaction Reporting (using RPA to cut cost& improve accuracy)
Banks have to report hundreds of thousands of transactions each day to various regulators. Inaccurate or missed reporting could lead to huge fines. Transaction Reporting BAU function requires daily exception management of reporting errors and rejections back from regulators. Additionally many regulators require banks to demonstrate effective assurance controls to validate if transaction reporting was done accurately by first line.
RCloud was engaged by one of our clients to review their existing process which had a BAU team in the region of ~60 people with significant manual processes for exception management and assurance. We introduced RPA to automate the sourcing and collation of exceptions from regulators and grouping into various categories. We further proposed solution to use AI to intelligently process and remediate new exception. We are currently at ‘Pilot’ stage and initial result show this could reduce the BAU headcount dramatically and improve accuracy
Suitability Assessments (Buy Side)
Regulatory requirements for Suitability have become increasingly stringent, and it is seen as an important control for safeguarding the interests of investors. Financial Planners and Investments managers spend a significant amount of time conducting suitability assessments. There is an opportunity for RPA to automate the more mundane aspects of data gathering and rules-based checks. It can help analyse variance between a client’s portfolio, return objectives and risk tolerance and flag any differences. RPA can also assist first and second line of defence to automate quantitative checks on a much larger set of suitability reviews.
Investment Research Automation
AI and automation solutions can reduce the Analyst time spent on creating Equity research and can make the offering to clients more attractive given the cost pressures introduced post MiFID II. Certainly for ‘less intelligent and standard tasks’, automation is expected to be a game changer in this area. These tasks include producing standard quarterly earnings reports, sourcing and processing publically available data, predictive modelling, performance calculation and attribution of buy/sell lists. RCloud has significant expertise in this area and can help Research teams on sell side and buy side to implement RPA solutions.
CCP Collateral processing leveraging Cloud and AI
RCloud is currently engaged by the Credit Risk Management team of a Tier 1 Bank to review the existing laborious and Error-prone process to clear OTC derivatives through Central Counterparty Clearing Houses (CCPs). Manual human effort required on a daily basis in collating the data from over 50 CCPs and then validating it. As a result, the collateral data is often inaccurate and late – preventing effective management of banks risk exposure.
RCloud has implemented a POC that leverages a cloud-based solution and an RPA layer to automate sourcing and processing of data from each CCP. Results are delivered via dashboards giving a real-time view of risk exposure, allowing timely interventions to limit risk and manage liquidity.
Risk Analytics on Cloud
RCloud and its Risk technology partner can help provide an integrated solution to provide industry standard risk models and analytics on the cloud. From producing PnL attribution, Greeks, scenario analysis we can provide more customised reports to support adhoc analysis. Data is available at the most granular level (trade-risk factor) and can be aggregated out of the box by any pre-defined hierarchy book, trader, portfolio, division.
Fraud Detection (AI)
RCloud is working on a use case to monitor the external facing payment interfaces of a financial institution using data mining and artificial intelligence to zoom in on ‘red flag’ payments. We are working with existing technology vendors in this space to put together an end to end solution for Financial Institutions to track 95% of Money Laundering and Fraud payments with minimal human effort.
The average financial firm spends US $60 million on KYC, customer on-boarding and customer due-diligence. Many of the currently manual tasks can be either fully or semi-automated to reduce human cost and improve accuracy. Some of these tasks include sourcing customer documentation, validating customer information, customer screening, regulatory monitoring, risk assessment and processing account closure.
Retail Banking Modules
If you have a banking license and are looking to set up a challenger bank then there are some exciting products available on the market which provide out of the box software modules required to run Retail Bank. From internet banking, mobile banking to Account Opening and Customer Contact centre service you can buy these as white box modules and overlay the branding of your firm with customisation possible to your needs. These modules are built with ready interfaces to connect to industry standard payment and settlement systems.
RCloud can help you identify the right product and implement a seamless solution to have you up and running in no time.
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