How BFSI Industry Is Navigating The Impact Of Automation On Jobs? Read Here

According to the report by McKinsey, around 10 per cent to 15 per cent of jobs in the BFSI sector could be fully automated by 2030, with a significant portion being routine and data-driven tasks

By Pushpavaneswaran Venkatraman & Kunal S

The Banking, Financial Services, and Insurance (BFSI) industry is experiencing significant changes due to the rapid advancement of automation technologies. Automation has the potential to transform the industry by streamlining operations, enhancing efficiency, and reducing costs. However, it also raises concerns about the future of jobs and the structure of the labour force within the BFSI sector.

According to the report by McKinsey, around 10 per cent to 15 per cent of jobs in the BFSI sector could be fully automated by 2030, with a significant portion being routine and data-driven tasks. This shift is expected to bring about a transformation in the potential future jobs and the structure of the labour force

One of the primary areas where automation has made a significant impact is routine and repetitive tasks. These include data entry, document processing, and basic customer inquiries. Automation technologies can handle these tasks with greater speed, accuracy, and efficiency, thereby freeing up human employees to focus on more complex and strategic responsibilities.

However, as automation takes over certain job functions, it is crucial to understand that it does not necessarily mean a loss of jobs. Instead, it paves the way for upskilling and reskilling the workforce. While automation may eliminate some roles, it simultaneously creates new opportunities that require advanced skill sets. Jobs that require business thinking, problem-solving, and relationship management, such as financial advisors, risk analysts, and customer experience specialists, are likely to remain vital as they demand human judgment and emotional intelligence.

Pushpavaneswaran Venkatraman, director of banking SME, Expleo, said, "Automation continues to create a positive shift in the Banking, Financial Services, and Insurance (BFSI) industry, prompting excitement and concern about its impact on jobs. As technology advances, the integration of artificial intelligence, machine learning, and robotics promises greater efficiency, accuracy, and cost optimization and saves time from performing menial tasks. However, the transformation also raises questions about the future of employment in the sector. The key lies in embracing automation as a complementary force rather than a threat. While routine and repetitive tasks are susceptible to being automated, it opens up avenues for upskilling and reskilling the workforce by 'Everyone Automates'. Jobs that require business thinking, problem-solving, and relationship management are likely to remain vital as they demand human judgment and emotional intelligence. The leaders in the BFSI industry must proactively invest in training programs to equip employees with the skills needed to navigate this evolving landscape. Collaboration between technology providers and financial institutions is crucial to maximizing the benefits of automation. By capitalising on the strengths of humans and machines, the BFSI industry can leverage automation to drive innovation, enhance customer experiences, and create new job opportunities”.

It is imperative for leaders in the BFSI industry to proactively invest in training programs to equip employees with the skills needed to navigate this evolving landscape. The concept of 'Everyone Automates' should be embraced, encouraging employees at all levels to develop an understanding of automation technologies and how they can work in tandem with them to drive efficiency and innovation.

Kunal S., general manager, OD consulting and facilitation, Marching Sheep, said "The BFSI industry has seen tremendous growth in automation and artificial intelligence, which has changed the way businesses and processes are run. For example, Robotic Process Automation (RPA) can automate repetitive and time-consuming tasks. While this creates time for employees to focus on complex problem-solving and decision-making tasks that require human judgment, those who don't take proactive measures to navigate through the changing landscape becomes predisposed to its potential impact on jobs. To ensure that we remain relevant and indispensable in the face of automation, we must embrace continuous learning, develop a growth mind set and embrace agility. By upgrading skills and staying abreast of the latest industry trends, employees can adapt to the new roles and responsibilities that come with automation. For example, employees can focus on developing skills in areas such as data analytics, risk management, and customer experience enhancement, which support the automation of services. People skills such as balancing empathy and responsibility as a people manager, building coaching capability to retain and develop talent, service leadership, collaboration, and cross-cultural competence in an ever-evolving workplace are timeless and irreplaceable. Employees should actively seek out opportunities to integrate with automated systems and leverage their potential to deliver improved results. By matching their skills with tools, employees can position themselves as valuable assets within the BFSI industry."

Collaboration between technology providers and financial institutions is crucial to maximising the benefits of automation. By leveraging the strengths of both humans and machines, the BFSI industry can create a symbiotic relationship where automation enhances human capabilities, rather than replacing them. This collaboration can lead to the development of innovative solutions, improved customer experiences, and the creation of new job opportunities in emerging areas such as data analytics, cybersecurity, and AI strategy.

While the impact of automation on jobs in the BFSI industry cannot be denied, it is essential to view it as an opportunity rather than a threat. By embracing automation as a complementary force and investing in the right training and collaboration initiatives, the industry can navigate this transformative period successfully. With the right approach, automation can revolutionise the BFSI sector, driving efficiency, improving customer experiences, and creating a more dynamic and skilled labour force.

Pushpavaneswaran Venkatraman is the director of banking SME, Expleo. Kunal S is the general manager, OD consulting and facilitation, at Marching Sheep.

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