Impact of Automation on the Banking Industry

The swift advancement of automation and technology is posing a significant threat to traditional business models, leading to ongoing disruptions in the global economy. Research indicates that banks are reallocating resources away from industries essential for the nation’s future. Although the banking sector has been slow to integrate automation into key processes like client onboarding, they are beginning to implement robotic solutions to perform tasks beyond human capability. For instance, the PPI mis-selling scandal could have been much less harmful had banks already adopted robotic systems.

Though humans can beat robots in imagination, creativity, building relationship and trust, and understand the point of view, they are prone to errors and without the ability to be unerringly controlled. Moreover, the use of robots helps in avoiding errors—minimizing the use of time and money. Since robots are 100 percent controllable, a proper automated process set up can help execute every task correctly.

Automation and robotics not only improves the customer experience but can mitigate risk too, which is essential as the Open Banking is pushing banks further into the technological revolution. But with automation, the chance to bond with customers also increases, and the implementation of PSD2 will do the same. Automation will free up customer service agents to focus more on building trust, sales, and relationships to deliver the best the best customer experience. If banks are to claw back customer relationships from third parties in the wake of PSD2, this is more important than ever.

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