November 29, 2022

Role of Real Time Automated Reconciliation in Real Time Transactions

The financial market is on the verge of ever-expanding growth. Financial institutes in the capital market are managing payments at an increasing pace. This trend may not change anytime soon...

Content Admin

The financial market is on the verge of ever-expanding growth. Financial institutes in the capital market are managing payments at an increasing pace. This trend may not change anytime soon. The immediacy of transactions needs a Real Time Automated Reconciliation. Thus, Financial institutions are now getting into tough competition. Considering all these factors, professionals recommend an automated reconciliation system to banks. It aids in improving accuracy & speed to manage financial activities.  

Let’s learn more about it

Why Choose Real Time Automated Reconciliation?  

Previously banks reconciled their data traditionally using the end-of-the-day process. It took at least one day to settle the issues of Nostro accounts. The delay in addressing issues with the end-of-the-day process brought forth the requirement for a real-time reconciliation system. Thus, an automated reconciliation system comes into the picture. As a result, it improves the reconciling efficiency of banks, depending on their real-time data management.               

Role of Real Time Automated Reconciliation in Real-time Transactions   

Reduced Reconciliation Time – Real Time Automated Reconciliation

Banks used the end-of-the-day process to reconcile data and took a whole day for settlements. With real-time automated reconciliation, matching operations run immediately. Therefore, real-time information reduces the timeframe of the reconciling process effectively.    

Enhanced Operational Efficiency  

Real-time information on when trades are settled helps operations teams to automate their delivery versus payment processes. It increases their control over this activity for covering a higher number of customers. Therefore, Automated reconciliation works non-stop 24X7 to increase the bank’s operations efficiency.     

Minimize Customer Transaction Disputes 

Real-time reconciliation enables Banks or financial institutions to deal with real-time transaction data. The reconciling process assists them in taking real-time or quick decisions to manage data exceptions. It minimizes customer transaction disputes before they arise and increases customer relationships or engagement with the financial institution.   

Managing Exceptions  

Using automated reconciliation enables Financial Institutions to enhance exception management efficiency. Errors in real-time transactions could be spotted and resolved with promptness. It ensures that the fraudulent transactions won’t go unnoticed and are given utmost priority while dealing. Automated reconciliation makes settlements without taking a whole day by checking the payments in real-time. It reduces the efforts and lowers the costs as well. 

Liquidity Management  

One of the biggest advantages of opting for Real Time Automated Reconciliation is to increase efficiency in liquidity management. Tracking intra-day cash movements increases cash position forecast accuracy. Intra-day mitigates the risk of uncompleted transactions and overdrafts. Balanced visibility, accurate forecast ability, and efficaciousness in liquidity management make automated real-time reconciliation the need of the hour. Therefore, It helps banks free up their significant funds for investment and make smart decisions based on real data rather than estimations.     

Working Capital 

Capital holds significance in financial institutions. Automated reconciliation emphasizes reducing the regulatory capital requirements decided by financial institutions. As a result, The risk & treasury team monitors intraday and end-of-the-day overdraft positions thoroughly before taking actions to minimize them. Therefore, this activity enables businesses to improve their profit margins.       

 If you are interested to know more about how Real-Time Automated Reconciliation will help your business grow, please Contact Us. We also offer consultation or schedule a demo to know about our solution.