Banking on Bots: The Move towards Digital Labor in Financial Services

Over the last two decades, banks and financial institutions have achieved significant efficiencies through outsourcing, offshoring and labor arbitrage. Those levers can only go so far, however, when it comes to further cutting costs and simultaneously growing revenues -- particularly at a time when disintermediation is increasing and budgets are diminishing. To address this, enter the "bots": Financial services institutions including retail banks, investment banks, custodians, commercial banks and insurers are turning to digital labor, which represents a new wave of technologies such as robotics process automation (RPA) and cognitive automation. "Bots" are not the electromechanical robots with arms and legs one may have seen in sci-fi movies. Instead, this refers to software configured to interact with computers and applications just like a human would, performing high-volume, repetitive processes and tasks.