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To Enhance Customer Experience, Indian Banks Need to Prioritize the Back Office
To Enhance Customer Experience, Indian Banks Need to Prioritize the Back Office

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The banking and financial services sector has undergone tremendous changes over the last few decades, but most of those changes are focused on front-office operations. Online and mobile banking, peer-to-peer exchanges, the rise of fintech start-ups and self-service banking: advancements like these have disrupted the industry and fundamentally changed the way many people bank. Today, even established banks are encouraging customers to complete basic transactions from their mobile devices, and customers have come to expect that kind of instant service as standard.

But what about the back office?

Back-office operations include all the unseen processes necessary to support transactions. Although banks have invested time and money in digitalizing their front-office operations, many back-office operations remain unchanged. This discrepancy can prevent banks from making the most of their digital transformations. Firms can offer all the features their customers want in a sleek interface, but manual operations in the back office can slow processing, weaken security and infrastructure.

Customer experience is especially important in this new era of banking. By modernizing back-office operations, banks can provide better service for their customers while streamlining essential processes to increase efficiency and their competitive edge.

The challenges of a dated back office

Banks today handle tremendous amounts of data, which can be difficult or impossible for manual processing to manage effectively. Legacy systems require more time and effort to process data than automated or hybridized systems, and they are more prone to errors.

Speed is also important for customer experience. People have come to expect quick turnaround times from mobile transactions, and manual processing cannot keep pace. At the same time, banks need to be able to respond to frequent change requests, which can be complicated and require coordination between various back-office processes.

Such inefficiencies make manual back-office operations costly to maintain. Solutions that leverage artificial intelligence, machine learning, and application programming interfaces (APIs) can supplement the processing and analytic capabilities of a human workforce and allow banks to scale effectively, but banks may be reluctant to make changes because these processes are so fundamental. A smooth modernization requires strategy, upfront investment, and follow-through.

Building a better back office

Traditionally, banks have focused on reducing costs and optimizing processes. While these continue to be the key drivers for growth, banks are now expanding their focus to include other critical areas:

·       Process enhancements to streamline operations

·       Automating and digitalizing processes so they can focus on their innovation agendas

·       Intelligent operations, fuelled by the right combination of data, technology, and talent

·       Regulatory compliance within stipulated timelines to avoid financial or reputational losses

The application of technologies like hyper-automation and application development through design thinking has been helping banks automate pay-out calculations to their channel partners. In India, for example, where direct selling agents act as the face of the bank while liaising with prospective customers, an efficient and dynamic commission pay-out process plays a huge role in channel partner satisfaction. An automation platform could help banks increase operational efficiency in channel pay-outs, improve accuracy, reduce manual errors and resolve time.

Similarly, by implementing intelligent document processing using next-gen technologies, banks can digitize large volumes of manual forms within the timelines set by regulatory authorities. Supplementing human experts with automation and artificial intelligence can increase efficiency while maintaining valuable oversight and specialization.

Strategic partnerships and holistic approaches

To access all these benefits, banks need to work with strategic partners who possess relevant industry knowledge and digital expertise. The right partner can help firms design, implement, and manage a back office that aligns with their business goals.

About the Author 

Bhaskar Pandey General Manager & India Business Head - BFSI, Wipro

Bhaskar Pandey has more than 27 years of experience in the banking and fintech industry. Throughout his corporate career, Bhaskar has held many business-critical roles spanning P&L, revenue generation, business process re-engineering, customer service, product development, debt management partnerships and alliances. Bhaskar holds a master’s in management studies from Mumbai University. 
 


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