Banks, NBFCs, and financial institutions get a huge inflow of customer applications which is why they use automated bank extraction software to derive key insights from them. Bank statement processing software is used by major organizations to verify client profiles and streamline customer onboarding processes. In this post, we’ll discuss what bank extracts are, how they differ from bank statements, and which industries require them.
Bank extract refers to data extracted from bank statements and processing them for the purpose of approving bank applications. The meaning of extract is to pull data from documents, structure, and organize information in a way that makes it easy to perform a financial audit or analysis.
A bank statement is a financial document that contains a summary of transactions occurring during a given month which is sent to the account holder. Bank statements have pages which list account holder names, numbers, transaction IDs, and lists of deposits and withdrawals. By analyzing a bank statement, a lender can assess the financial standing of an individual, verify income sources, and perform cash flow analysis for assessing creditworthiness. Bank statement data extraction software is used by financial institutions to process these statements and record them in systems in electronic formats..
Bank extracts are processed by organizations for verifying address, identity, and the creditworthiness of individuals. These extracts map out cash flows to and from accounts which is what makes them valuable for determining an individual’s financial standing. Organizations use bank extracts to assess their total assets, identity liabilities, and list out deductions.
Bank extracts are used by the following industries:
Patients who opt for loans or borrow money to fund their medical treatments or pay pharmacy bills have to furnish their bank statements to get financial aid. This also applies to those who are applying for insurance policies such as medical insurance and disability/accident/life insurances.
2. Real estate
Property owners and individuals who are planning to buy land for the purpose of commercial residence or agriculture need to provide bank extracts in order to get their applications approved. Bank extracts are used as proof of address/identity when it comes to buying, selling, renting, and leasing real estate properties.
Individuals who approach banks and NBFCs for loans such as home loans and mortgages need to furnish bank extracts to get their creditworthiness verified. Banks often pull these extracts from customer data and CIBIL databases to get the information they need to assess credit profiles and customers’ repayment capacity.
Automated data extraction software enables banks to record and assess the transactions occurring in customer accounts over a given period of time. Bank extracts contain elements which are needed by organizations for performing credit profile analysis of consumers. Processing huge volumes of customer data is a challenging task that is prone to a high error margin with manual data entry and this is where automated bank statement data extraction technology truly shines. By using automation solutions, companies can flag fake statements and remove duplicate transactions when accounting.
In today’s dynamic business world, filing and archiving official documents in the digital form makes it handy, and works wonders in the future or in unforeseen circumstances.
With an automated data extraction solution, loan documents can automatically be processed end-to-end without any human errors and delays. Automation in loan document processing prevents downtimes, eliminates data redundancy, and allows companies to respond faster to client queries. By combining machine learning with deep learning and OCR, companies can eliminate huge costs, derive actionable insights, and streamline loan processing and approvals through efficient data extraction and analysis.
Mortgage lenders receive multiple identity and income verification documents along with different forms from loan applicants in a variety of formats and styles. Traditional OCR solutions fail to extract data from these semi-structured documents and that’s why more and more lenders are adopting intelligent document processing solutions. IDP solutions not only extract data correctly, they are able to validate extracted data against predefined rules in order to improve accuracy.
Intelligent Document Processing is an automation technology that captures information from a myriad of documents and data sources, extract data, and organizes it for further processing. IDP solutions enable businesses to seamlessly integrate with core processes, eliminate manual labour, address challenges faced in reading different document layouts, and meeting legal & compliance requirements. Accurate data is the foundation of every organization, and IDP assists businesses in dealing with the complexity of processing huge volumes of documents, helping them automate manual data entry processes, and move away from traditional semi-automated OCR workflows.