April 28, 2023

Transforming Fintech with OCR Scanning: A Game Changer for Efficiency and Accuracy

Lake Norman
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Outsourcing OCR Services for Increased Efficiency and Cost Savings

OCR services refer to the outsourcing of Optical Character Recognition (OCR) technology to a third-party provider. OCR services providers use specialized software and hardware to digitize and extract text from images, PDFs, and other types of documents.

OCR services are commonly used in industries that require high-volume document processing, such as banking, finance, insurance, and healthcare. By outsourcing OCR services, companies can reduce costs and improve efficiency by automating document processing and data entry tasks

Use Cases for Optical Character Recognition Online in Fintech

Optical Character Recognition (OCR) scanning has numerous applications in the Fintech industry, primarily in improving efficiency and accuracy in document processing and data entry. Some of the specific use cases for OCR scanning in Fintech include:

KYC and Identity Verification

Fintech companies are required to perform Know Your Customer (KYC) checks to verify the identity of their customers. OCR scanning can be used to extract relevant information, such as name, address, and ID numbers, from identity documents like passports and driver’s licenses, and automatically verify them against the information provided by the customer.

Invoice Processing

OCR scanning can be used to extract information from invoices, such as vendor name, invoice number, date, and total amount due, and automatically enter it into accounting software or ERP systems. This helps reduce errors and manual data entry, improving efficiency and reducing costs.

Loan and Credit

Application Processing: OCR scanning can be used to automatically extract relevant information from loan and credit applications, such as income, employment history, and credit scores. This can help streamline the application process and reduce the time it takes to approve or reject a loan or credit application.

Fraud Detection

OCR scanning can be used to detect fraudulent documents by analyzing the fonts, layouts, and other features of the documents. This can help prevent fraud in the application process and reduce the risk of financial losses for the Fintech company.

Benefits of OCR solutions

OCR scanning can provide significant benefits for Fintech companies, including increased efficiency, improved accuracy, reduced costs, and enhanced fraud detection capabilities.

Survey Results: Financial Services Professionals’ View on OCR Text Recognition Technology

  • According to a report by Zion Market Research, the global OCR market in the Fintech industry was valued at USD 4.7 billion in 2018 and is projected to reach USD 13.1 billion by 2025, growing at a CAGR of 16.8% between 2019 and 2025.
  • A study by Adlib Software found that 90% of financial services professionals surveyed believe that automating document processes with OCR technology can significantly reduce errors and increase efficiency.
  • A report by EY found that 40% of financial services organizations are already using OCR technology, and another 29% plan to implement it in the next 12-24 months.
  • A survey by ABBYY found that 70% of financial services organizations use OCR technology for document processing and data extraction, and 80% of them reported increased accuracy and efficiency as a result.
  • According to a study by Mitek, a digital identity verification company, OCR technology can reduce the time it takes to onboard a new customer from 26 minutes to just 4 minutes, resulting in significant cost savings for Fintech companies.

OCR Process

OCR (Optical Character Recognition) is a technology that enables the conversion of handwritten, printed, or typewritten text into machine-readable digital text. The process typically involves scanning a physical document or image and then using specialized OCR software to identify and interpret the text characters. This involves a series of steps, including image pre-processing, character recognition, and text correction. OCR software uses complex algorithms to analyze the document and recognize patterns, shapes, and other features that correspond to specific letters, numbers, and symbols. Once the text has been recognized and interpreted, it can be stored as digital data, edited, searched, or processed automatically. OCR technology has numerous applications in industries such as finance, healthcare, and education, where it can improve efficiency, reduce errors, and enhance accuracy

Conclusion

OCR scanning has revolutionized the way the Fintech industry processes and manages documents, bringing significant benefits such as increased efficiency, improved accuracy, reduced costs, and enhanced fraud detection capabilities. With the rapid advancements in OCR technology, the Fintech industry is likely to witness even greater efficiency gains in the coming years. As such, OCR services will continue to be in high demand as more and more companies seek to leverage this technology to streamline their operations and stay ahead of the competition. Overall, OCR technology is a game-changer in the Fintech industry, paving the way for more innovative and efficient processes in the digital age.

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April 28, 2023

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