Financial institutions are investing in tech to drive efficiency among market pressures to increase deposits. 

According to Jack Henry’s 2024 Strategy Benchmark report, increasing operational efficiency is a top strategic priority for banks and credit unions over the next two years. The survey was conducted in January and February and included responses from 127 bank and credit union chief executives. 

The following FIs have made recent investments in efficiency: 

• Citizens is seeing up to 20% efficiency gains through generative AI; 

  

• HSBC digitalized internal operations to boost efficiency; and

• Wells Fargo has invested in self-service capabilities through its mobile applications. 

Bank Automation News sat down with Vice President and President of Bank Solutions at Jack Henry Jonathan Baltzell to discuss how to approach efficiency projects within financial institutions tapping new technology. What follows is an edited version of that conversation. 

BAN: How does a financial institution determine where to invest in technology? 

Jonathan Baltzell: It starts with the institution’s strategic plans. That’s what needs to drive investment in technology and elsewhere. When we did our most recent benchmark study, we found that the top two priorities for banks were growing deposits and increasing efficiencies. Those two areas of focus can be tied together. For example, our online account opening solution JHA OpenAnywhere really helps drive a more efficient process for online account opening. 

BAN: How can a financial institution identify what to automate? 

JB: On the efficiency side, I think every institution should look at what they can stop doing. That’s the quickest way to gain efficiency, find things you can stop doing. 

From a technological point of view, an area where we see consistent and quantifiable gains is in workflow automation and robotic process automation. Institutions that integrate Jack Henry’s jhaEnterprise Workflow (EWF) solution with their Jack Henry Core, see a cost benefit of $108,000 on average. When they integrate EWF across multiple solutions, that’s when you see those results really start to compound. For example, if you integrate EWF with your core, our CRM solution and our content management solution, the cost benefit is on average $229,000. 

BAN: How do you approach an efficiency project with a financial institution? 

JB: Any efficiency project is going to start with some sort of cost analysis or reward projection. We see a lot of institutions that aren’t running as efficiently as they could be, but they may not possess the depth of knowledge in their solutions to identify those inefficiencies.  

Jack Henry has an internal group, JHA Client Services Consulting, which is made up of former bankers who have operated our solutions and can help determine where to boost efficiency within bank operations.  

From there, the team puts together the cost analysis and projected reward and based on those numbers, banks can do a lookback and see if their investment in workflow automation or robotic process automation or other tools is paying off.  

BAN: What technology is Jack Henry investing in to keep up with client demand for new capabilities? 

JB: The following are among Jack Henry’s technology modernization initiatives: 

• Jack Henry Financial Crimes Defender: Our new fraud solution, currently in beta, leverages Feedzai’s industry-leading AI engine to reduce false positives and gain efficiency through the fraud process on a single platform. In this platform, we utilize AI and behavioral analytics to manage and automate the BSA and fraud processes in near real-time. 

• Enterprise Account Origination: We had a number of disparate account opening solutions that we’re melding together into one cohesive account opening platform that’s designed to reduce friction, improve the account opening process and provide an account opening experience that can be completed in a matter of minutes. I think we’re pretty close to being able to achieve that in the next year. 

• Jack Henry Platform: The platform is a collection of modern core services. We are in the process of instrumenting these services with AI capabilities, and we think that’s going to be a huge opportunity to provide efficiency gains for financial institutions.