Why Investing in Banking Tech is Critical
- Staying abreast of the latest banking tech is crucial
- Checks are popular targets and require cutting-edge tech protection
- "Wait and see" approach can and will result in prodigious losses
The banking industry can learn from recent history; it can look back at the past few decades of "the check is dead" being stated as truth. At the recent Wespay Payment Symposium, Steve Cree, Vice President, ECCHO Rules and Member Governance - The Clearing House, reminded us that the notion of "check death" has been around since he started in banking back in 1983.
This sentiment is a major factor as to why checks have become a major target for fraudsters. Many financial institutions bought into the "check is dead" notion and chose not to invest in the payment channel. This left the channel not only inefficient, but also vulnerable to fraud. However, many FIs have made the move to deploy AI and machine learning for both check processing and check fraud detection, automating the payment channel while securing their customer accounts.
Will US banks learn from the lessons of the recent past? Can they glean insights from other banking markets across the globe?
Importance of Investing in Technology
A recent article from American Banker magazine digs into best practices to capture maximum value from technology and AI:
AI was the talk of the American Banker Digital Banking conference held this week in Boca Raton, Florida (where McKinsey was knowledge partner). The buzz is easy to understand, given its potential to boost productivity and lift so many elements of banking today to a new level. In the context of several sectoral headwinds, for CIOs and C-suites thinking about digital and AI, the challenges are compounded by three major factors: the need to demonstrate ROI on past technology investments, differentiate the bank from competitors, and achieve success in their existing transformation efforts.
Some issues covered in the article include:
Future of Check Processing and Check Fraud Detection
As seen in the different use cases referenced, Asia and India are at the forefront of investing in technologies. The USA banking industry needs to heavily invest in tech to keep up with these foreign markets.
We've seen US banks take a passive, wait-and-see approach vs. being proactive and at the forefront. However, the US banking industry must take advantage of technologies like AI and machine learning to improve the financial sector.
As customers of OrboGraph can attest, leveraging OrboGraph's Orbnet AI and Orbnet Forensic AI streamlines check processing and increases check fraud detection capabilities, creating superior productivity gains and risk management improvements.
Once they overcome their hesitancies and start their technology journeys, there really are fewer and fewer limits to what AI and machine learning can do to assist banks in achieving their goals .