Banks are locations where tons of data and information is exchanged every day. They have to keep a record of every withdrawal, transaction, and loan. Since it is a very happening place, they have to organize and categorize the information efficiently.
To keep track of a borrower’s finances, taxes, and monetary status, the bank does financial spreading. To calculate all this data manually would be very taxing, and automated financial spreading is a much quicker and efficient process.
What is Financial Spreading?
Financial spreading is a process by which the bank reviews and analyses the finances of the client/ borrower. The borrower compiles their financial statement records and lends this information to the bank for them to organize.
The bank will not alter any of the information but rather present it in such a way that the borrower can have a better idea about their financial situation. This process is essential for borrowers to make decisions in terms of credit, loans, and investments.
Manual and Automated Spreading
Financial spreading can be done in two different ways, manual and automated. Manual spreading is when the financial document or statement is manually scanned and uploaded onto the computer/software.
This is a very time-consuming process as each document has to be uploaded individually. It also requires skilled practitioners and resources when dealing with different geographical locations and languages.
On the other hand, automatic spreading is where the information and data will be automatically categorized with very little human intervention. It is not limited by the location or language and creates a standardized and error-free analysis.
Automated Spreading and Accuracy
The most significant perk of automated financial spreading is that it is more accurate than manual spreading. Manual spreading can lead to many errors, especially when data has to be compiled from different locations and languages.
Automatic spreading limits these errors and provides data that is reliable and accurate. Therefore, the borrower will be able to examine the correct information and make decisions based on this. The bank and investment advisors can also better guide the client/borrower if they can access the correct data.
Data that is processed through automated spreading is not only accurate but also better organized and precise. This helps the customer understand the information that is being presented. Therefore, they do not always have to rely on an economic advisor.
Therefore, automated spreading is customer-centric and works for the benefit of their understanding. Customers’ experience can be further enhanced by specific information provided in automated spreading, and additional details will inevitably result in improved decisions.
There are times when companies and businesses require a quick mapping of their finances. This is because they might want to borrow money or invest as soon as possible. When this happens, manual spreadsheet processes are very slow and can delay the needs of the client.
Automated spreading makes use of Artificial Intelligence to gather data quickly and efficiently. The client can get the information and analysis that they require only in a matter of days. Data extraction processes through automated spreading are about 70% quicker than the manual process.
Automated spreading processes are way more cost-effective than manual methods. This is because manual methods require many skilled staff and resources, which can cost a lot of money.
For example, if the data has to be analyzed in a particular language, the worker and analyst must also be well versed in that language. But in automated spreading processes, this is not the case, and data can be interpreted and organized without the limitations of geographical and linguistic differences.
This is also more cost-effective because a large group of people would not be required to merely comprehend and feed the data.
Managing finances is not only a confusing and tedious task, but it can also be very risky unless properly managed and executed. Many people end up taking risky decisions without being aware of the full implications and consequences.
In manual spreading processes, the client often does not get a clear and defined picture of the challenges they might face due to borrowing or investing. They also do not know how this risk can affect their finances in the long run.
But since automated processes have all the data compiled under one roof, it is easy to predict the risk factor of decisions both short and long term.
Automated financial spreading is the best way to analyze financial records with a lot more speed, efficiency, and accuracy.