Emerging technologies like Artificial Intelligence (AI) and Machine Learning (ML) are proving to be transformative forces, offering efficient alternatives to labor-intensive processes. One area where these technologies are making a significant impact is in reconciliations and exceptions management. There is a wide range of reconciliations challenges that AI and ML could be applied to, among them exceptions management within payments, clearing and settlement, and corporate actions. At the moment, most exceptions management is handled manually, which is time consuming and requires lots of resources and therefore expensive. Manual exceptions management is also a significant source of operational risk.

AI and ML bring a new dimension to reconciliations. Unlike traditional methods, AI can handle vast volumes of data, rapidly identify problems, and present actionable insights to human analysts. By automating complex processes and predicting exceptions hotspots, AI reduces operational costs and mitigates risks. Natural Language Processing (NLP) and Natural Language Generation (NLG) further enhance the interaction between analysts and systems, making structured and unstructured data more accessible.

Challenges in Reconciliations:

Financial institutions, dealing with multifaceted operations, face a plethora of challenges in reconciliations such as:

• The process of matching large volumes of transaction records.
• Identifying exceptions.
• Resolving them manually is not only time-consuming but also error-prone.
• Existing solutions often lack flexibility, leading to inefficiencies in handling complex and rapidly changing requirements.

The sheer complexity of reconciliations and exceptions management, coupled with the high cost involved, necessitates a smarter approach, this is where Validata steps in.

AI powered, end-to-end Reconciliations

Validata can help banks simplify their reconciliations complexity, mitigate the risks and address the data challenges, through end-to-end automation, intelligent matching, combined with cloud deployment and managed services.

Powered by AI and machine learning, the platform can auto configure reconciliations, irrespective of the data structure or format, extract and consume data from various sources such as Statement Files, Databases, APIs, aggregate the data where it is necessary and provide true end-to-end reconciliations, enabling you to gain maintain visibility and management control across your reconciliation activities.

Processes and calculations - which would take a human, hours of work - are now performed in seconds. The use of AI is greatly reducing the need for human exceptions handling, cuts cost while at the same time reduces operational risk due to human errors.

The platform includes a powerful matching engine and integrated exception management capabilities that deliver the highest automated matching rates and ensure that any failed transactions are escalated, repaired and returned to the process flow.

The solution is all about making things easy and simple for users. It uses advanced AI to help business users do things on their own without needing a lot of help.

• Flexible Definition of Intelligent Matching Rules and ability to define the sequence in which the matching rules will be applied (one-to-one, many-to-one, and many-to-many matches).
• Automatic Capture of Data: Data from Temenos modules (Transact, TPH etc), data captured through files and interfaces such as Swift, etc.
• Multiple reconciliation types: Cash/Nostro-Vostro/bank account/ close of business reconciliation.
• Seamless integration with Temenos Transact both Cloud and on-premise.
• Exception reporting easily configured using rules for the efficient identification, tracking and resolution of transaction breaks.
• Exception handling user friendly UI for manual rectification of unbalanced items with simple drag and drop interface handling one-to-one, many-to-one, and many-to-many relations.
• Reconciliation Reporting: the reports that can be generated include Matched and Unmatched Items, GL, Nosto, Internal accounts, Vostro Reconciliation, GL Profit and Loss and many more pre-built reports. Enables users to view and interrogate all real-time and historical data in the repository for a consolidated operational view
• High Performance: Super-fast processing of large datasets to complete common reconciliation operations in just seconds.
• Support complex reconciliations: Unlimited data sources and unlimited attributes per data source can be defined to support the most complex reconciliations.

By automating and standardizing their reconciliation process, banks can benefit :

• Eliminating manual errors and frauds, whether deliberate or not.
• High performance - quickly process large quantities of data.
• Time efficient – freeing business users from tedious and repetitive work.
• Available audit trail provides a ‘single version of the truth.’
• Reduced Total Cost of Ownership
• Increased quality and transparency