5 Ways RPA Enables Accurate & Insightful Compliance in 2024
Regulatory compliance is becoming increasingly challenging, with businesses facing a complex web of evolving regulations. Non-compliance can lead to significant penalties, with fines reaching an average of $14.82 million per incident according to Deloitte. However, manual compliance processes are inefficient, inconsistent, and error-prone. This is where robotic process automation (RPA) comes in. By automating repetitive compliance tasks, RPA enables businesses to cost-effectively achieve more accurate, insightful compliance.
In this article, we‘ll explore 5 key ways RPA empowers compliance functions:
1. Eliminate Unauthorized Access to Privileged Data
Data privacy regulations like GDPR and CCPA mandate strong controls around sensitive customer data. However, data breaches caused by human error account for over 25% of incidents annually. RPA bots can prevent such incidents by taking over data processing.
Bots replicate human actions like data entry, transfer and storage without manual oversight. This removes the risks of human error leading to unauthorized data exposure. Bots also log full audit trails of all data transactions, simplifying compliance reporting and investigations.
For example, an insurance firm could use RPA bots to:
- Extract customer data from documents
- Redact sensitive fields
- Encrypt and securely store data in databases
This automation eliminates the chance of human error causing data leaks.
| Manual Data Processing | RPA Automated Processing |
|---|---|
| Prone to human error | Eliminates human errors |
| No audit trail | Complete audit trails |
| Unauthorized exposure risks | Controlled data access |
2. Verify Processes Against Compliance Regulations
Industry regulations like HIPAA require rigorous validation of processes handling sensitive data. RPA bots can continuously monitor processes and verify compliance to these regulations.
Bots are programmed to evaluate process workflow logs against regulatory policy documents. They auto-flag any deviations from prescribed protocols for auditors. Bots also provide real-time alerts on non-compliant processes allowing preventive action.
For example, a hospital can deploy RPA bots to:
- Check if patient intake processes adhere to HIPAA rules
- Flag missing consent forms or unauthorized access attempts
- Generate reports of process violations for administrators
This constant process verification enables proactive auditing rather than reactive compliance.
3. Automate Low-Value Reporting Tasks
Mundane regulatory reporting consumes thousands of man-hours annually. RPA bots can automate data collection, report generation, submission and archival.
Bots reliably extract data from sources like ERPs as needed, such as quarterly financial statements. They compile standardized reports in proper formats for submission. Bots also validate report data against sources to reduce errors.
For example, a bank could use RPA to:
- Pull transaction data weekly from core banking systems
- Check for suspicious activity patterns indicating fraud
- Generate Suspicious Activity Reports (SARs) for AML audits
This automation allows compliance teams to focus their time on high-value risk analysis rather than repetitive reporting.
| Manual Reporting | RPA Automated Reporting |
|---|---|
| Repeated data collection | Automated data extraction |
| Prone to human errors | Validated accurate data |
| Cumbersome report creation | Streamlined report generation |
4. Continuously Update on Changing Regulations
Regulations like consumer finance laws frequently change, but 60% of firms don’t use automation to update internal policies accordingly. RPA bots provide a solution.
Using natural language processing, bots are programmed to continuously scrape regulatory websites for new laws or modified regulations. They extract updates, match them to impacted internal policies, and notify relevant staff to make changes.
For instance, an auto lender can use RPA bots to:
- Track Consumer Financial Protection Bureau (CFPB) site for consumer credit regulation changes
- Extract new regulations published in documents on the site
- Email staff responsible for lending policy to update procedures accordingly
This automation ensures internal policies remain continuously aligned with the latest external regulations.
5. Minimize Errors in Third-Party Due Diligence
Vendors and partners require extensive due diligence like KYC and background checks pre-onboarding. Such repetitive checks are error-prone when done manually, delaying onboarding.
RPA bots can take over collecting documentation, screening names against sanctions lists, checking legal records and calculating risk scores. This boosts speed and accuracy of due diligence.
For example, banks can use RPA bots to:
- Automate KYC verification for new third-party vendors
- Audit vendor processes and data security controls
- Accelerate vendor onboarding timelines by over 50%
By reducing manual errors, RPA minimizes third-party compliance risks for the enterprise.
RPA enables organizations to achieve accurate, insightful compliance while eliminating inefficient manual processes. Automating repetitive compliance tasks reduces costs, accelerates procedures and minimizes errors.
While RPA delivers major advantages, integrating intelligent technologies like AI can further boost regulatory compliance. AI algorithms can detect financial crimes or anomalous behaviors indicating compliance issues.
Leading corporations like Microsoft, S&P Global and ABB are already leveraging RPA in their compliance functions. With the right strategy, compliance can transform from a challenge into a competitive advantage.
