OCR In Insurance: Automating for Digital Transformation
Integrating OCR and IDP allows the insurance industry to gain a huge advantage as they can help automate document processing, a process that plays a significant role in the industry.
OCR has been adopted in the finance & accounting sector or accounting departments of any businesses. See how finance & accounting OCR has helped accelerate business growth.
So much of what finance and accounting teams spend their time doing is simply processing documents and basic transactions. Hours go into extracting data from multiple document formats and then manually adding the necessary information to various systems.
If that sounds like a waste of time, that’s because it largely is. OCR, or “Optical Character Recognition” software is able to perform these tasks in a fraction of the time and with a far lower rate of error. By automatically extracting relevant fields of data, finance and accounting OCR can expedite transaction processing and help businesses avoid delays and even potential fines.
Anyone working in the finance of a business knows all too well how costly small, daily accounting errors can be. That’s a risk that finance and accounting OCR can help eliminate, saving both money and time. Furthermore, businesses in the financial sector trying to protect themselves from fraud by having KYC verification benefit hugely from finance OCR. It can accelerate that and many other financial processes.
Doing things manually may still be the norm for many but switching over to OCR in finance and accounting can help improve the way a business runs, both in speed and efficiency.
“Optical Character Recognition” might sound like nothing you’ve heard of before, but it’s being used every day. Beyond any fancy terminology, OCR is AI technology that is used to “convert images of typed or handwritten words into digital text” (Forbes, 2021). The technology typically uses a combination of hardware, such as scanners, to first “read” the document and OCR software which then takes over the more advanced data processing.
Physical documents and PDFs are transformed into usable digital data in a fraction of the time it would take a person to manually input and process that information. Businesses can also combine OCR finance and accounting with other AI technologies to further automate data extraction. Data can be taken from structured, semi-structured, or even unstructured financial documents – the possibilities only grow.
If a business is trying to cut down on inefficiency by introducing AI technology, OCR accounting and finance is one of the very steps first steps in that journey. It brings paper documents into the digital age, extracting what you need from them and feeding it into software in one easy go.
So many businesses have automated how data is processed but it’s important to shift how we capture it too.
For internal accounting departments and businesses in the financial sector, OCR makes extracting relevant data quicker and easier than ever. Though it generally needs to be used alongside accounting software or machine learning systems to provide maximum benefits, it’s a highly important piece of the automation puzzle. This is why:
It can be incredibly tiresome to sift through receipts and invoices, find the information needed, and then type it all up. Often businesses are dealing with documents from outside suppliers and customers as well as internal staff for reimbursement.
Those documents are rarely standardized and the effort to go through each one and find the relevant information when it’s presented so differently every time is significant. The time it takes to go through all of it manually also makes no sense when OCR is available.
OCR accounting technology scans those physical receipts and invoices and then converts the contents into digital information, making it far easier to search, file, and manage all that data. The information can be read and sent straight to whatever accounting software is in use, eliminating the need for manual data entry.
Not only does this mean that valuable staff aren’t wasting time on menial tasks, but it also drastically reduces the risk of error that often occurs with manual data entry. It doesn’t matter the size or format of the invoices and receipts coming in, finance OCR solution will process the text characters and produce usable data far faster than a human could. It really is one of the most powerful ways that businesses can make use of AI technology.
The value of OCR accounting and finance doesn’t stop in the accounts departments. OCR software is also extremely useful for any business, especially banks, that need to quickly extract and verify ID and proof of address for customers. We’ve all had to stand there patiently while a bank teller goes through our documents, painstakingly entering each bit of information into the computer while a queue gathers behind us.
OCR finance software that is combined with machine learning can expedite that entire process. It can extract data fields like name, identity number, date of issue, etc. from IDs, passports, and driver’s licenses. Similarly, the technology can also read proof of address documents such as bank statements and extract the necessary information to verify address and identity.
This is crucial for any business trying to uphold KYC standards as it automates the customer verification process. With any AML, being able to screen and verify information is a base point and something that using OCR can speed up considerably. It also ensures that fewer errors are being made during the process, thus improving a business’s ability to comply with AML and KYC standards.
The vault of security that AML is intended to add to business processes is only made stronger and more efficient by using OCR in finance systems
Incorporating OCR into the financial workflow of a business and automating data entry accelerates multiple processes. Here are just some of the benefits of by using OCR in finance and accounting settings:
If you’ve ever gone through a stack of receipts and entered the information into a spreadsheet, then you know how dull that work gets. It’s so easy to doze off, type the wrong number in or miss out on information entirely.
One of the key ways in which OCR can improve a business's financial processing is simply by doing away with manual data entry and replacing it with a far more intelligent system. “Intelligent” in that OCR is able to convert physical documents into digital data without the errors that a person might make. This means that the data entering the system is far more accurate and as such, more reliable.
Another benefit to automating data entry and removing the risk of human error is that it reduces the chance of small, silly mistakes costing a business. The fact that data is processed from invoices and receipts much faster with OCR than with manual data entry also helps businesses avoid potential fines or late payments.
In these ways, using finance and accounting OCR can save a business money simply by limiting errors and making crucial processes more efficient.
Invoices and receipts come in a range of formats and going through them can be extremely tedious. OCR accounting takes that pain away entirely by reading the text for you and transferring it into digital data at a speed that manual data entry just can’t match.
It means that every other step that follows the processing receipts can happen quicker too. By simply automating that first step with accounting OCR, there’s a domino effect across the whole accounts payable system.
Businesses are constantly trying to protect themselves from employees making fraudulent expense reimbursement requests. Using accounting OCR makes it much harder for fraud to go by undetected because things like receipts are being processed intelligently and are thus more easily analyzable.
The bane of any auditor’s existence is the piles of paper they’re often met with as they try to sift through documents. By digitizing the information on physical documents and PDFs with OCR, a business makes it far easier for auditors to do their work and to do it with greater depth as well. They’re able to see the details of each transaction quickly and easily, rather than simply relying on reports from staff.
OCR accounting and finance saves employees from wasting precious time on data entry and leaves them to better focus on strategic tasks. Customers also benefit greatly from OCR as it means that they don’t have to wait as long for their identity to be verified during application or claims processes.
Employees don’t want to have to wade through boring work and customers hate dealing with waiting periods. OCR helps to solve both those problems.
By now, you can probably see why we’re so passionate at FormX about OCR, machine learning and what they can do for a business. We have a set of pre-trained data extraction models such as ID OCR, Bank Statement OCR, Invoice OCR, Receipt OCR, and Address Proof OCR to suit your needs. Each set can extract information from relevant data fields and turn it into a digital format that your business can use easily.
If you’d like to see more ways in which our OCR finance software can be implemented, you can look at our case studies. We’ve shown just how FormX has been able to accelerate business processing and automate data entry in a variety of contexts. If you need even more evidence, you’re welcome to schedule a demo with us. We’re happy to answer any of your questions.
One of the questions you may already be asking is how best to integrate OCR with your existing accounting software. If you’re using a fast and easy API, it’s quite a simple process and key to making sure that our OCR software is supporting the workflows you already have in place. Using the FormX OCR accounting and finance sets doesn’t require a complete overhaul of how you do things, it simply optimizes and automates how data is captured.
If you ever feel overwhelmed, we have plenty of resources for those new to the software. Incorporating OCR does not need to be a difficult process. It’s here to accelerate your business, not slow it down.