ROI-botic Automation Helping Credit Unions’ Bottom Line

Robotic process automation, often implemented to reduce costs, can also increase revenue. More than a third of Capgemini surveyed financial institutions attributed a 2-5% growth directly to an intelligent automation strategy.

Orlando, Fla.-based EnableSoft, creator of Foxtrot RPA software, confirmed that more financial institution including credit unions are leveraging RPA to increase accuracy, boost productivity and grow the bottom line.

RPA – ready to use smart automation centering around software robots or artificial intelligence tools – according to HFS Research will grow from an estimated $629 million market this year to a projected $1.2 billion in 2021.

“The possibilities really are endless for RPA software,” EnableSoft CEO Richard Milam said. Foxtrot by EnableSoft is a scalable RPA that comes in different flavors including robotic automation software, which powers business tasks in Excel, web, windows, or legacy applications without coding or programming; and FoxHub, which manages bots and runtime.

When EnableSoft introduced Foxtrot in 1995, the term robotic process automation did not even exist. Screen scraping, extract translate and load, and data scripting are among the terms used to describe Foxtrot, originally created to enable banks to migrate data from acquired institutions.

“Our technology is a leader in time to value because it’s easy to use, a business model that’s palatable for even small to midsized financial institutions and credit unions,” Milam said. “We’re kind of a new arrival in the credit unions. We probably have about 50 credit union customers, but we have Navy Federal Credit Union who’s the largest one (at $92 billion) and they have been using our RPA for a while,” Milam said.

He added they have seen credit unions using Foxtrot for items such as managing compromised account management system alerts, post-conversion data cleanup, and automating interaction between unlike tech platforms.

Three credit union examples:

• The $182-million Lubbock Texas-based Texas Tech Federal Credit, which recently merged two credit unions, replaced merger services provided by its core data processor with Foxtrot RPA. “Over the next couple of years, we’ll be able to reduce the cost of mergers by about 80%,” Pranay Siri, the credit union’s business intelligence analyst said.
• The $1.04 billion Kalamazoo, Mich. based Consumers Credit Union actively engaged in selling its loans, typically bundling as many as 500 loans for sale at one time. Prior to deploying Foxtrot, the credit union manually prepared each loan for sale. “We’ve been able to eliminate several days’ worth of manual data entry for every group of loans we sell,” That inevitably leads to more loans sold in a shorter period.
• The $2.5 billion Redwood City, Calif.-based Provident Credit Union, began using Foxtrot to close inactive credit and debit cards. However, according to document and image retention manager Amanda Seals, its greatest value is in the escheatment process, where she explained they cannot have a single error. “Sure, Foxtrot saves us many, many hours of manual processing, but accuracy is just as important. We’ve never had an error processing escheatments with Foxtrot.”

The usage of AI, and its subset machine learning, is a rising trend among financial institutions as they seek to improve customer satisfaction, reduce inefficiencies and fight fraud. But some of the expectations are somewhat overstated, at least currently, according to Milam. He explained real AI, involving machines learning based on data and then altering its algorithms and tables accordingly, is hard to achieve. “I’m pretty sure that very little actual AI in production today, but it is evolving.”

This is where robotic process automation comes into play today.  “RPA is the vehicle that bypasses the IT development cycle. RPA functions are placeable in an asynchronous manner, whether from a vendor or inhouse,” Milam noted. He acknowledged there’s talk about APIs, interfaces and vendors trying to do a better job of making those connections available. “I still believe they overpromise and underdeliver, there’s still manual things that need to happen to make those things work. RPA is a way to bridge that gap.”

Milam suggested as AI-killer apps start to develop, especially around business intelligence, they will help financial institutions help figure out who’s profitable and where they should develop more products. “There’s going to be this connection between the back room and the front office.”