Even as optical scanners and email solutions promise cost-efficiency and convenience, financial institutions, especially across the Asia Pacific region, still rely on fax machines for transactions involving documents bearing confidential account information and signatures, such as trade confirmations to loan applications.
Due to cost concerns, such financial institutions for decades been installing internal centralized fax servers instead of deploying fax machines for each branch, office and department. However, while this move reduces the average cost per page, financial institutions with high fax value could still rack up millions of dollars in expenditure to support their global infrastructure due to operational costs such as telecom expenses, scheduled capacity assessments, hardware and software upgrades and redundant backup systems.
Following the implementation of the General Data Privacy Regulation (GDPR) in Europe last year, for instance, financial institutions in Asia processing European residents’ personal data now have to be even more conscientious in ensuring data privacy compliance. Any form of exposure of clients’ information – whether resulting from hard-copy documents lying around or even digitally on a computer screen – could potentially lead to financial institutions facing costly penalties, litigation and reputation damage stemming from a breach of confidentiality. Documents stored on an unsecured server or in an unencrypted e-mail also pose significant regulatory risks.
With the pressing need for simplified architecture, robust security, and compliance with local regulations, implementing a cloud-based fax strategy is now paramount for financial institutions to address challenges around data protection and scalability.
Benefits of Cloud Faxing
As all-in-one machines that combine printing, copying, faxing, and scanning functions rarely feature hard-drive encryption, financial institutions leveraging these appliances are especially at high risk of unauthorised persons breaching sensitive information. Having a reliable cloud-based fax services provider reduces these data privacy threats through enhanced data encryption.
Cloud-based fax services help provide financial institutions with increased visibility and traceability of incoming and outgoing faxes – this is especially helpful for audit purposes. Advanced cloud-based fax solutions offer comprehensive real-time monitoring and detailed reports that provide an archive of the metadata for transmission of documents, ensuring simplified compliance with regulators. This centralised approach streamlines legal discovery, regulatory review and audit processes, as there is no longer any reliance on personal filing systems.
Driving cost efficiency and transparency
By migrating to cloud-based fax service solutions, financial institutions are able to realise lower expenses as costs associated with acquisition, implementation and deployment. Ongoing management of fax servers and regional telecom providers will no longer be necessary. The hosted solutions enable costs to be spread over millions of transactions, allowing financial institutions to achieve economies of scale that ultimately benefit their bottom line.
As cloud-based fax services provide live reporting across a variety of levels, financial institutions can better monitor fax usage and allocate costs according to usage history as they shift from a cost centre model to an activity-based chargeback system where resource distribution is based on fax usage. This translates to greater levels of transparency inside organizations and across individual business units – leading to more effective budget planning and cost recovery and control across financial institutions.
Digitalizing financial institutions effectively
Paper-based documents such as proof of income, registration forms with legally valid signatures and copies of identification cards remain essential in processes such as loan applications. In most financial institutions, contract documents are still being manually captured and assigned to the necessary processes. The data entry procedure not only proves to be time-consuming due to the high volume of incoming documents, but also poses a high risk of manual error. Manually entering data also translates to duplicated work, possibility of human error, and enormous follow-up costs and associated delays in approvals.
Now, more than ever, large international banks need to have an intelligent means of transmission that allows documents such as leasing or financial agreements to be sent securely and efficiently by fax and received in email clients and business applications, where they can then be processed.
Advanced cloud-based fax solutions today feature barcode recognition, which helps facilitate the automatic and immediate assignment of documents and signatures to the relevant procedure without the need for manual data capturing. Powerful document recognition systems leverage multiple optical character recognition engines that convert documents into a more readable form and which allow financial institutions to benefit from optimised automatic recognition of incoming documents and minimised manual processing.
Together, the technologies available for financial institutions to wean off manual, analog workflows and comply with data protection regulations are mature, cost effective and need to be firmly entrenched in any financial institution that wishes to remain relevant.