What Is Robotic Process Automation (RPA)?

Robotic Process Automation (RPA) is a software technology that allows businesses to automate a wide array of tasks and processes. Contrary to what you might think, RPA doesn’t involve robots of any kind. Instead, what we often refer to as a “bot or “digital employee” is actually a piece of software code that mimics human behavior to execute various business processes.

RPA bots are programmed to perform specific actions like copying and pasting data from one workbook to another, processing transactions, or flagging data inaccuracies. Essentially, any kind of task that is routine, repetitive, and rules-based can be performed by an RPA bot.

Robotic Process Automation (RPA) isn’t here to take anyone’s job. Instead, it automates some of your most tedious, computer-based business processes so that your employees have more time and bandwidth to innovate. Common use cases for RPA include, but are not limited to, tasks like:

  • Entering and extracting data
  • Inspecting and comparing data
  • Making if/then decisions
  • Running reports
  • Organizing or manipulating data files and folders
  • Sending and receiving email

By liberating employees from these repetitive, time-consuming tasks, process automation makes your improves employee morale, improves customer experience, and allows your business to become more efficient. Think of it like training a new digital employee, except this new employee never gets tired, never takes breaks, and doesn’t get bored.

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How Does Robotic Process Automation (RPA) Work?

At a high level, RPA developers create a set of rules-based instructions for a bot to perform a specific task in much the same way that an employee does. The specifics vary widely depending on the selected process to be automated, the tools to be used, and the goal of the automation.

Fortunately, most RPA software is intuitive to use, so there is no need to be intimidated! It is not necessarily a low-code/no-code solution, but business users can utilize RPA software with proper training and governance. RPA developers, sometimes called citizen developers, often have the same critical thinking skills observed in software developers, but they do not need the same extensive and formal education.

How Robotic Process Automation Adoption Has Grown

Process Automation's Rise: From Fastest-Growing Software to Core Enterprise Strategy

In 2019, Gartner identified Robotic Process Automation (RPA) as the fastest-growing segment of the global enterprise software market. The pandemic in 2020 accelerated this growth, pushing organizations to digitize critical operations at scale. By late 2020, Gartner predicted that up to 90% of Fortune 500 and Global 2000 companies would adopt RPA by 2022—a prediction that largely materialized.

Now in 2025, automation has moved beyond tactical deployments. Gartner emphasizes the shift toward unified process automation architectures and AI-augmented development, noting that by 2025, 30% of enterprises will have implemented AI-enhanced strategies—up from just 5% in 2021. Automation is no longer just a cost-saving tool; it's a strategic imperative driving scalability, efficiency, and innovation.

Why the rapid adoption? RPA’s ability to introduce automation into legacy processes and software, without needing to replace existing infrastructure, makes it an ideal choice for digitizing the workplace. Industries such as banking and finance have been quick to adopt RPA due to the ability of bots to function as a strategic piece of the digital transformation toolkit.

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How Do Banks Benefit From Robotic Process Automation (RPA)?

It’s no secret that the banking industry operates under a strict regulatory framework. Estimates suggest that banks spend approximately 10 percent of their operating expenses on compliance costs alone. The investments required to maintain compliance, combined with reliance on legacy systems, mean banks must split their focus between maintaining the status quo and finding new ways to serve customers or manage their operations.

As the industry grows more competitive, and as customers demand more agility, flexibility, and digital experiences, banks need to adapt and digitize everyday processes to keep up. Hiring more staff is not the answer. RPA is an ideal fit and makes it possible to reduce manual labor, increase compliance, and ultimately improve the customer experience.

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How Is Process Automation Used in Banking?

The customer demand for digital services in the financial services industry has necessitated ongoing investments in new services and technologies. Unfortunately, since the core banking systems remain central to operations, new processes have been needed to reconcile the disparate systems. RPA is ideal for handling this new workload much more quickly and more accurately than human employees.

There are a multitude of tasks Robotic Process Automation (RPA) is made to handle in banking operations, including:

  • Opening and closing accounts
  • Processing loan applications
  • Performing back-office functions for trades
  • Ensuring compliance and KYC requirements are met
  • Automating accounting processes and checks
  • Performing risk management analyses (e.g., stress tests)
  • Resolving customer service requests
  • Automating HR tasks
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Which Major Banks Are Already Using Process Automation?

Virtually all major banks worldwide have been quick to invest in RPA and leverage it for operational efficiency. The technology is approachable for companies of all sizes, so now is the time for regional and community banks and credit unions to invest in automation too.

According to a recent report, approximately 81% of banking CEOs are concerned about the speed of technological change, more than any other industry sector. RPA benefits banks by offering maximum efficiency and lowered costs, all while keeping security as a top priority. These benefits make RPA an appealing option for banks to tackle problems quickly without a hiring surge they can’t afford.

Why Is Robotic Process Automation (RPA) So Useful in Banking?

Speedy Processing

Bank workers are responsible for a high volume of manual tasks that require fast and efficient processing. RPA is an ideal solution to handle these processes much more quickly. Just imagine, for example, validating customer data in seconds instead of minutes. Automation Edge suggests that “Introducing bots for such manual processes can reduce processing cost by up to 70%.”

Reliable Accuracy

In addition to speed, automating banking tasks improves accuracy by removing the possibility of human error or delay. Banking requires quick filtering of incoming requests, as with fraud prevention. RPA can flag suspicious and potentially fraudulent transactions in real-time and prevent them from slipping through the cracks.

Compatibility with Legacy Systems

RPA utilizes existing user interfaces to execute its tasks, so it can operate with multitudes of existing applications without issue. It’s expensive and time-consuming – often unrealistic – for banks to overhaul their current systems, so RPA offers the ability to work with existing systems and workflows such as those found in loan application processing.

24/7 Availability

While improved speed and efficiency during the workday are obvious benefits from using RPA, automation also allows for tasks to be executed around the clock. This means banks are able to scale the throughput of a given process at any time, even outside of standard business hours.

Ensures Compliance

Undeniably one of the highest expenses for community banks, compliance processes are improved dramatically with RPA, ensuring alignment with ever-changing state and federal regulations. As an example, banks can utilize bots when processing Know Your Customer (KYC) checks to easily verify a customer’s identity with external sources, including identity checklists and international databases.

Process Automation Use Cases in Banking

There are numerous opportunities to leverage RPA in banking processes to boost operational efficiency. A few examples include:

Customer Onboarding:
Since RPA bots automate rules-based processes, they can easily handle opening a customer account in all the various and required systems with limited human intervention. (Of course, they can do the same in an offboarding scenario, as well!)
ACH Processing:
Erroneous ACH payments can be stopped faster with a bot. Bots are ready to activate as soon as the predefined events are met, jumping between systems and confirming all data before storing the required information in a spreadsheet for reporting.
Reporting:
A bot can aggregate all data across multiple, disparate systems into a single report to support informed decision-making, eliminating the need for employees to spend hours manually creating reports.
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Customer Support:
When customers call into a care center, the banker may have to interact with multiple systems and databases to serve the given need. A digital worker can serve as a go-between and fetch the necessary data for the employee, reducing the time to issue resolution.
Loan Processing:
Book more business each month by leveraging an RPA bot’s ability to process loan applications in bulk rather than one at a time, all while following compliance guidelines. These batches can be grouped and filtered based on a set of preferences or criteria.

Process Automation vs. Automation Within the Core

It’s important to acknowledge that most core banking systems offer automation add-ons. Although these are useful, they will always be limited in their impact because they work only within the given system.

Robotic Process Automation, on the other hand, is much more flexible and can be used anywhere in the organization without being limited to a legacy software package. RPA enables the automation of processes that require multiple systems or applications, including:

  • Core banking software
  • Debit card management software
  • Treasury management software
  • Excel
  • CRM
  • Payroll
  • HR
  • Outlook or other email clients
  • And more!

RPA might be considered the bank’s IT Swiss Army knife, offering a multitude of tools and capabilities to fit the workflows used both today and into the future.

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The Future of Robotic Process Automation (RPA) in Banking

It’s undeniable: automation initiatives will increase dramatically in the coming years due to the competitive edge they offer to banks large and small. McKinsey’s Global AI Survey reports nearly 60% of sector respondents in financial services have already embedded at least one AI capability. Of the most common automations, RPA is responsible for 36% of structured operational tasks, and that number will surely increase over time.

The bottom line is that automation is essential for banks to remain competitive in today’s market and beyond. The future is a fast one, and RPA ensures that banks can move fast enough to keep up.

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Financial institutions, and banks in particular, are ideal candidates to succeed with RPA.

They employ multitudes of people to complete the same work daily, weekly, or on some recurring basis to ensure customers are well-served and that all work is done with the utmost diligence. The reality is that all the repetitive, rules-based, and time-consuming work can be automated with today’s technology and deliver results much more quickly and accurately. Any bank that doesn’t recognize this will someday struggle to compete and/or be acquired.

To embrace the digital future, banks must be open to rethinking the way work is done and making the most of every skill available, both old and new. Banks that prioritize building an automation capability today will experience greater efficiencies in their operations, more engaged employees (that enjoy more creative work), and happier customers in the years to come.

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