Prioritize Back-Office Transformation in Banking for Long-Term Efficiency & Cost Control
With potential economic disruption on the horizon, economists are predicting a possible recession, interest rates are rising, and the labor shortage is still an ongoing concern - especially for financial institutions working to modernize their services. With these challenges in mind, Forrester analysts predict that the best investment for banks and credit unions is to innovate their way through these waves, and to redirect their spending to improve operational efficiency.
Banks and credit unions have done a great job of placing the bulk of their technology budgets on front-facing applications to improve the customer experience, but enhancements to resource-heavy back-office processes have been slow. Rather than backlogging innovation projects, prioritize refreshing back-office operations to put your financial institution in a stronger position when the economy is back in the upswing.
Costs of a Manual Back-Office
Historically, image processing systems varied by line of business and given their age and architecture, depend on specialized teams to maintain. The institutions who rely on these systems also have to consider any manual efforts that have to be performed as a lack of functionality available, which can be a significant impact on their bottom line and overall productivity. Simple but costly inefficiencies like keying errors, manual reconciliation and posting, a lack of cross-platform data exchange, and applications deployed by channel can contribute to millions of dollars of additional overhead costs annually.
Adding additional automation to Day 2 and other back-office efforts improves productivity and scalability without draining the budgets. More resources are then available to provide better customer and member services and allows for faster decision-making as a result of better access to enterprise-wide business intelligence. To be truly future-ready, executives must invest in reinforcing the foundation of their operations with modern technology.
Next year's economic predictions may give you cause for worry, but some business leaders are considering it as an opportunity for banks and credit unions to reanalyze their processing methods and determine how their existing solutions can be modernized, in parallel to automating their remaining manual tasks.
So, what are banks and credit unions to do?
To find ways to control costs and maintain operational efficiency in the coming months and beyond, banks and credit unions must reevaluate activities and look to automation for the manual, redundant, and error-prone activities by line of business. Banks and credit unions whose back-office processes are as streamlined as their account holder-facing services will be better positioned to withstand cyclical economic changes.
And, by leveraging platforms that are built on modern tech-stacks, including those that scale effortlessly while keeping overhead costs in check regardless of volume fluctuations, will ensure profitability and long-term efficiency.
Unify for Enterprise-Wide Efficiency
Unify, Alogent’s single API, open banking platform, is proven to revitalize both front- and back-office processes, including all full- and self-service channels. Built on the most modern tech stack in a cloud-ready architecture, scalability is limitless and cost-effective, with no impact on hardware requirements or servers. Its single API and common set of code eliminate the need to manage disparate solutions across various payment channels, exchange files or batches between applications, or manage various maintenance and upgrade schedules - reducing overhead and upkeep costs.
With Unify, every point-of-capture relies on one database and reporting dashboard, allowing for real-time image and data validation, posting, and a clear and centralized view into all transactions.
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