Data precision ‘more important than ever’ financial services firms say
Moving from manual processes to automated systems to accurately reconcile data across multiple locations is becoming more crucial for financial services firms — but many struggle to make the move
14th July 2021, London UK — Nearly half (46%) of financial services organisations say that data precision is more important to their business in 2021 compared to previous years — but many are struggling to make the change to automation — a new report from Duco finds.
Driven by multiple factors such as the pandemic, tightening regulation, increasing competition, and the need to cut costs, half (45%) of financial services organisations are now actively investing in ways to improve data reconciliation and precision — moving away from manual techniques to automated-based systems — within their business.
Data reconciliation, which broadly ensures the accuracy and alignment of critical company data between systems, has traditionally cost financial firms significant sums of money due to the cost of maintaining legacy systems and the number of employees needed to conduct reconciliation manually. And with armies of people comes significant human error, incurring further costs as well as making regulatory compliance challenging.
Nearly half (46%) of firms are therefore looking to improve their reconciliation approach to reduce the risk of regulatory non-compliance and associated fines, while also getting ahead of the competition. Two fifths (40%) are doing so to reduce the risk of fraud and nearly half (45%) are improving their data reconciliation efforts to improve operational agility and resilience.
But while many are investing in ways to improve, the vast majority are struggling to do so quickly and effectively enough. This is due to the challenges such as competing internal priorities, justifying the investment and the logistics of moving away from legacy systems.
In fact, 44% believe the different types of data they must deal with as a company makes it difficult to reconcile anything without manual processes. Four out of 10 (42%) also believe that the risk of disrupting their business to improve data reconciliation is not worth the benefits of data automation.
Christian Nentwich, CEO, Duco said: “We are now seeing a significant proportion of financial services providers waking up to the need for better data reconciliation — and this proportion is only set to increase dramatically over the next couple of years.
“What many organisations don’t realise though is that machine learning and ‘intelligent data automation’ technology has vastly improved over the past few years, making automated reconciliation a reality once and for all.
“The dream is to get to a point where you have one system to deal with all your data reconciliation, no matter what that data is and where it resides. Then, you can pave the way to self-optimising reconciliation where the process automatically improves over time — saving huge amounts of money and time.”