Major banks are increasing their plans to automate repetitive, low-value tasks, according to research by the FT.
The move comes as traditional banks face high churn, attrition, and burn-out rates, especially among junior staff, together with the wider threat from challengers, start-ups, and FinTech players.
Goldman Sachs, Barclays, and Moelis are among the many to have kickstarted projects designed to automate functions such as pitch books, media data scraping, client information, and valuation modelling, particularly in their investment banking arms.
According to the FT this week, Goldman Sachs alone has nearly 100 automation and efficiency projects under way within its investment bank, including automatic data updates within presentations.
Meanwhile, Barclays is exploring ways to automate junior bankers’ tasks, with the stated aim of enhancing – rather than minimising – their work experience, as well as improving efficiency.
However, one of the challenges of automating functions in the services sector generally is that while repetitive admin tasks leave junior staff with boring, low-value grunt work, they are also among the ways they learn the ropes and understand the machinery of an industry. That is particularly true when it comes to the legal sector.
However, Financial Services leaders acknowledge that automation will help them reduce headcount as well as increase efficiency, especially if automation indirectly leads to wage increases as staff move onto higher-value, more customer-centric tasks.
Automation has been given added impetus by staff tackling record levels of deal-making while working remotely and managing Covid-related stress.
David Erickson, a lecturer at the Wharton School of the University of Pennsylvania, is quoted as saying, “Instead of eight to 10 [presentations] a week for the team, it’s now eight to 10 presentations a day.”
“This is not about people working less. This is about people working on things they value,” added Huw Richards, JPMorgan Chase’s global head of digital investment banking.
- In related news, the UK taxpayer now owns stakes in at least 25 FinTech start-ups, thanks to investments by the government’s Future Fund. That’s according to AltFi research.
Roughly 16 percent of all companies to receive government help by this route are in FinTech, from data released this week by the British Business Bank. Beneficiaries include Monese, Chip, Snoop, Kroo, Molo, and JaJa Finance.