Financial organizations including banks, securities and investments, mortgage, real estate, and insurance rely on paper-based information from tax returns, loan applications, appraisals, correspondence and remote deposit paperwork. Paper-based processes are costly, time-consuming and make archiving difficult. Digitization is the way to go, and it can offer several benefits to financial firms. These include:
- Lesser data retrieval time
- Lowers storage costs
- Provides better efficiency, better record-keeping and reporting
- Eliminates the need to manually search through heavy binders to find the required documents
- Increases productivity of employees
Professional document scanning companies can scan the paper documents and convert them into the required digital formats. This helps to improve organizational workflow, reduce costs, as well as save physical storage space and time. The following are the reasons why document scanning and converting to digital format is important in the financial sector:
- To adhere to laws, rules and regulations – The Sarbanes-Oxley Act and the Patriot Act require companies to step up the quality of their bookkeeping. Audits are stricter than ever before and the penalties for non-compliance are much harder. In order to ensure that paperwork is properly catalogued, stored, and retrievable, many financial institutions are converting paper records to digital format, with the help of document imaging solutions to support ECM (Enterprise Content Management).
- To implement service-level agreements (SLAs) and improve client compliance – Many providers of financial services have agreements with clients that all their records will be properly processed, stored, and easily retrievable. Converting paper-based records into digital format and storing them electronically makes it easy to conform to client contracts and SLAs.
- To simplify business processes – Document imaging solutions can simplify routine business processes. Simple tasks such as invoicing or tracking accounts payable can benefit from paperless processes. Scanning invoices into a centralized data repository allows financial services companies to easily monitor payment schedules, track P&L and securely archive paperwork for tax records.
- To route documents and approvals – Routing paper documents to obtain executive approval is time-consuming and can lead to errors, including misplaced paperwork or missed corrections. However, taking the approval and signing process online (electronic approvals) can save time and cost over traditional paper-intensive methods. It is simpler, more secure, and easier to manage and log. Elelctronic approvals eliminate geographic barriers as approvals can be made through the internet, without having to rely on fax machines or couriers.
- To file tax and secure signatures – CPAs (Certified Public Accountants) use secure data archives to share documents with clients, including tax paperwork for review and signature. Electronically signed taxes and forms can be processed electronically; this in turn helps create audit trail and speedy processing.
- To protect records from disaster – Unlike other businesses, financial service companies have to keep records for a longer period of time to keep track of stock purchases, financial trades, portfolio performance, tax records etc. Digitizing the documents not only eliminates paper storage, but also makes data easier to catalog and retrieve. It also secures the important documents from fire, flood, and the ravages of time, as digital archives can be backed up on virtually any medium or even stored in the cloud for offsite secure access.
- To streamline loan and mortgage applications – A mortgage of loan requires proof of income, tax forms, financial records, and many other paper documents. As complex loans can take some time to complete and approve, applicants may not always be available for timely approvals and signatures. However, converting loan applications to paperless processes can streamline the process, which makes it easy to attach all the relevant paperwork to the same file and circulate it electronically for fast reviews, approvals, and signatures.
- To support big data analytics – Big data analytics helps financial departments and institutions to get more accurate insight about fiscal trends. This will help them make more accurate business decisions. However, to support big data analytics, all the relevant data should be available, including both synchronous database archives and asynchronous data such as forms and written paperwork. By digitizing the paper documents, new data sources can be included in big data analytics.
Given the necessity of document scanning solutions in the financial sector, partnering with a reliable document scanning company is the practical solution. Outsourcing is a more affordable option because you don’t have to invest valuable dollars in expensive equipment and scanning personnel.