Automation Revolution: How Technology is Transforming Fund Administration

Attomus / Blog

Another great post from Myrtle, this time looking at how technology is changing financial services

The advancements in automation technologies are driving the transformation of fund administration. Automation is at the forefront of this transformation, helping to streamline operations, reduce costs, and enhance accuracy. 

fund management - piggy bank

Various technologies are also reshaping fund administration. They’re bringing about significant improvements in performance and efficiency. Let’s learn about some key automation technologies that are reshaping fund administration:

1. Automation

Automation is revolutionizing fund administration by improving efficiency.  Given its importance, it’s essential to carefully select a fund administrator who leverages these technologies to maximize the benefits for your organisation:

Robotic Process Automation (RPA)

RPA automates repetitive tasks such as data entry, data extraction from various sources, and data reconciliation. This reduces manual labour and minimises human error. RPA also frees up fund administrators for more strategic tasks that can expand their value to the organisation.

Workflow Automation

Automated workflow systems ensure that tasks are completed efficiently. This reduces bottlenecks and improves productivity. Through features like document management and real-time tracking, they streamline processes and enhance collaboration across teams. Because of this, workflow automation makes it easier to manage records and comply with regulatory requirements.

2. Data Management

Robust data management practices ensure the accuracy and integrity of financial information, fostering greater transparency for investors and regulators. They also allow administrators to easily generate reports and provide auditors with the necessary information.

Some technologies that help reshape data management in fund administration are:

Artificial Intelligence (AI) and Machine Learning (ML)

AI algorithms process large amounts of data at a time, all while detecting anomalies that humans are more likely to miss. This improves risk management and investment strategies.

On the other hand, ML models can automate decision-making processes by continuously learning from new data. They improve the accuracy and efficiency of fund administration.

Data Visualization Tools

Fund administrators can leverage data visualisation tools to create interactive dashboards and customizable reports.  Visualisation tools like Tableau and Power BI provide interactive dashboards that make interpreting complex data and identifying trends easier. 

Administrators can also utilise customisable reports and dashboards. These tools allow fund administrators to create customised reports tailored to specific needs, improving communication with stakeholders.

Real-Time Data Feeds

With up-to-the-minute market data for informed decisions and instant transaction updates for accurate record-keeping, real-time data feeds offer fund administrators a critical edge.

Real-time feeds deliver constant market updates, empowering fund administrators to make swift investment decisions. These feeds provide real-time updates on transaction statuses, ensuring accurate and up-to-date records.

3. Cloud Computing 

Cloud computing is also revolutionary for fund administration. Cloud solutions allow fund administrators to scale their infrastructure up or down based on their needs. They’re also accessible from anywhere with an internet connection. This fosters improved collaboration between fund administrators, investors, and other stakeholders, regardless of location.

Cloud computing offers a variety of services and technologies that benefit fund administration in several ways:

Software as a Service (SaaS)

SaaS platforms deliver fund administration software applications over the internet. This eliminates the need for installation and maintenance.

SaaS allows administrators to focus on core tasks. Fund administrators simply subscribe to a service and access it through a web browser. This reduces costs, improves accessibility, and ensures everyone is using the latest version.

Platform as a Service

PaaS provides a platform for building custom applications. Fund administrators can develop tools tailored to their specific workflows and needs, improving efficiency and automation. Examples of PaaS for fund administrators are Microsoft Azure, Amazon Web Services (AWS) Elastic Beanstalk, and Google App Engine. 

4. Regulatory Technology

Fund administration is facing a growing burden of regulations. RegTech tools can analyze vast amounts of data to identify potential regulatory risks. They also help streamline workflows and automate tasks to improve overall efficiency. In addition, RegTech solutions incorporate robust cybersecurity measures to protect sensitive financial data and ensure compliance with stringent security standards.

Some regulatory technology tools for fund administrators include:

KYC Verification Platforms

KYC (Know Your Customer) verification platforms are digital lifesavers for fund administrators. It’s a secure online portal where you can upload customer documents, and the platform automatically verifies identities against global databases. 

These platforms streamline the onboarding process and ensure compliance with KYC regulations. These platforms also offer features like facial recognition and document verification using AI that help minimise the risk of fraud.

Compliance Management Software

Compliance Management Software helps administrators track and manage compliance with various regulations. It provides administrators with alerts and updates on regulatory changes. 

This software centralises all compliance-related activities, making monitoring and managing them easier. Features include policy management, incident tracking, and training management. All of these features ensure that all aspects of compliance are covered.

Final Words

A fund administrator who utilises automation is essential for success. Partnering with a fund administrator who leverages the automation technologies above can enhance your organization’s operational efficiency and decision-making. These technologies are key in driving the automation revolution within fund administration.

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