Automated Digital Workflows for Banking Processes: Use Cases

Far too often, banks’ most important processes are siloed and inflexible. They are built around digital tools that demand coding from the IT department, require customized integrations, or don’t integrate well with existing systems. Such disjointed processes make it difficult for banks to adjust, reconfigure, and update business rules to a constantly changing financial and regulatory environment. Automated digital workflows are designed to eliminate these siloes, and make the life of project owners, stakeholders, and customers easier and more efficient. The best-automated workflows have low or no coding requirements, enabling banks to make changes on the fly. Here, we’ll explore why point solutions are not enough, the advantages of automated workflows for banking, and potential use cases to streamline banking processes.

The Consequences of Silos and Point Solutions

Many banks already have digital tools in place for business process management. Yet these tools often only cover certain aspects of workflows rather than end-to-end processes. For example, robotic process automation (RPA) is sometimes used to improve the efficiency of specific tasks, such as underwriting loans and generating documents. The problem here is that silos remain, and processes are not integrated. As a result, it’s common to see things like customers being able to fill out some forms electronically, but the forms don’t remember information that was supplied at another stage of the process. Banks also tend to adopt digital tools as point solutions, which leads to choppy digital journeys. For example, customers may be able to begin their onboarding process from a digital channel but are ultimately redirected to a branch to sign documents. When systems don’t communicate automatically with each other when customers are forced to repeat information with each new task when digital tools are tacked onto otherwise non-digital processes, a number of KPIs are negatively impacted including:

• Completed onboarding: Fewer customers onboard due to cumbersome, time-consuming, and repetitive compliance requirements.
• Turnaround time: Agents spend an excessive amount of time chasing customers for documents and signatures due to disjointed processes.
• NPS: Net Promoter Score, a measurement of customer satisfaction, suffers due to lengthy, confusing, and manual processes.

Automated Digital Workflows: Benefits For Banks

Banks are complex institutions that are beholden to even more complex regulatory demands. Without an automated digital workflow, banks will be forced to deal with the consequences of silos and standalone solutions outlined in the previous section.

Why Automate Workflows?

On the one hand, frequently changing KYC requirements mean that managers need to ensure their processes on a macro and micro level are up-to-date. Failure to do so can result in fraud breaches, hefty penalties from regulators, and reputational damage. On the other hand, banks cannot afford to be dependent on IT departments every time they need to make changes to their processes. Such dependency leads to widespread inefficiency, employee fatigue, and customer frustration. Adopting a digital workflow automation solution can allow banks to build processes that reflect compliance and business requirements –– without a manual or IT dependency.

Key Benefits of Switching to an Automated Digital Workflow

• Simplified processes: A single system controls the entire end-to-end process with a simple drag-and-drop interface.
• Digital tools in one digital suite: At various stages of the workflow, rules trigger the sending of requests for eSignatures, eForms, document collection, digital payments, and ID verification.
• More streamlined processes: Easy and intuitive conditional rules can be set to ensure business logic between steps, within steps, and within form fields. 
• Optimized: Each customer interaction can be optimized across touchpoints and existing systems.
• More visibility: Digital workflows come with dashboards that allow business leaders to gain visibility into the KPIs that matter most, such as onboarding rates and turnaround time.
• Zero IT involvement: Project managers can adjust their business rules according to their needs without requiring IT support or coding. 

Common Banking Use Cases Leveraging Digital Workflows

As we’ve seen, automated digital workflows ensure banks’ processes reflect the latest compliance and business requirements.  The biggest use cases for digital workflows can be found in the onboarding and lending processes. These are two areas that demand bank agents to accurately determine customer risk levels without jeopardizing completion rates.

Onboarding

Before: Manual, siloed workflows turn onboarding into a friction-filled process. Customer abandonment of the account opening process is rampant. After: Automated workflows use conditional logic to ensure customers move seamlessly from one step of the process to the next. Customers have no reason to abandon the process. Banks have to strike a delicate balance. It’s in their interest to onboard the maximum number of customers as efficiently as possible. Unfortunately, money laundering, terrorist financing, and fraud are part of the reality as well. Bad actors who manage to open up bank accounts can wreak havoc on banks, necessitating things like ID verification, KYC documents, and onboarding forms. At the same time, the vast majority of potential bank customers are legitimate. These customers have limited patience for time-consuming and paperwork-heavy KYC processes, and are at risk of dropping off from the onboarding process if they encounter excessive friction. As such, banks need to minimize the friction innocent customers experience as they onboard. Digital workflows are designed to maximize compliance and minimize inconvenience. A typical onboarding process using automated workflows can look like this:

1. Agent sends the customer a KYC questionnaire to determine their risk profile.
2. Depending on the conditional information received, the workflow triggers a request for additional documents or further identity verification. 
3. Workflow generates relevant account opening forms with information prepopulated and sent to the customer for electronic signatures. 

Here are some examples of conditional logic triggers banks may want to employ for onboarding: If: Applicant history is [x] If: Risk profile is [y] Then: Request additional documents Then: Share documents with clauses for signature

Lending

Before: Complicated loan applications filled with irrelevant fields and unclear next steps lead customers to make mistakes — or abandon the process altogether. After: Streamlined loan applications use conditional logic to keep customers moving quickly through a tailor-made process, reducing abandonment and mistakes. Even once customers have passed the onboarding KYC process, they still require monitoring. Customers’ risk profiles are not set in stone, and therefore KYC actions must be taken at key moments in the customer lifecycle, such as loan applications or modifications.  Similar to the onboarding process, banks need to accurately gauge their customers’ risk levels when they seek a loan. At the same time, confusing or repetitive requests for information can dissuade customers from taking out a loan with their primary bank. At the very least, cumbersome processes hurt efficiency and waste the time of both agents and the customers they serve. Automated digital workflows can make it easier for banks to easily request information from customers seeking to take out a loan. Here is a sample workflow:

1. Workflow generates relevant loan application forms with information prepopulated and sent to the customer for electronic signatures. 
2. Depending on the conditional information received, the workflow triggers a request for additional documents such as proof of income or source of funds.
3. Customer digitally sends additional documents as needed.

Here are some examples of conditional logic triggers banks may want to employ for lending: If: Credit score is below [x] If: Risk profile is [y] If: State or residency is [z] Then: Request additional documents Then: Escalate Then: Request electronic signature

Digital Workflows for Efficient and Compliant Banking

Perhaps the greatest advantage of automated digital workflows is that banks can adapt them to their exact needs. This flexibility means that customer interactions with the bank are more efficient and targeted. Customers provide only the information that is needed from them, no more and no less. Automated workflows ensure banks keep the ball rolling between critical steps, bringing both better compliance and efficiency.  Lightico offers such a workflow automation solution that uses conditional logic to streamline end-to-end customer interactions. The platform includes eSignatures, smart eForms, digital document collection, and instant ID verification. Learn more at Lightico.com.