The Xceptor Blog

Is reconciliation the problem or is it data control?

16 April 2021

2 minutes read time

Reconciliation has been described as anything from Capital Markets’ dirty little secret by Tabb Forum’s Dayle Scher to Capco’s view they are something that perhaps shouldn’t exist. The reality likely lies somewhere between the two but suffice to say recs refuses to go away and without a seismic shift in how capital markets firms deal with them, they are likely to remain an unwelcome, and expensive, guest for a long time to come. 

With margins tight, client expectations high and regulators circling once more, should you continue to consider recs across internal systems, external systems and everywhere else as normal, reasonable, cost of doing business? Surely, we can automate our way out of this. Or come up with a better plan at least? 

In a recent episode of the Unleash Your Data podcast, Jibs Ahmed from Capco threw down the gauntlet to Capital Markets firms – to do data properly so that reconciliations don’t exist. That, he urged, is what banks should make an ambition. 


Take control of your data

So that gives us a neat segue to data control. Folks in the reconciliation business are in fact increasingly talking about data control rather than better reconciliation. If you fix the data, you stem the tide of internal system recs, internal and external system recs, reduce your risk profile and stop annoying your customers. 

Ignoring there is a fundamental problem with the data architecture or repeatedly fixing data problems in isolation, for one team or one process is never going to workBack to Jibs’ take on this.  

The amount of repetition in processing the same data again and again is insane, not only is there an inefficient set of processes there because you have multiple humans doing the same thing with the same set of data. There is an added level of inefficiency, 4-5 people doing the same task, who will do it slightly differently, mistakes will be made processing the same data but then you will have to reconcile the data.  


Pave the way for a frictionless reconciliation process

So, data control. That needs a powerful data automation engine to get data right at the outset. You can start with a single process and that will bring improvements in your process, your domain, but if you are looking for the true caterpillar to butterfly transformation, you need to dream bigger. Go cross team, cross division, go all in. But wherever you start and however big you go, if it is with data control, you are ahead of the game and will turn heads.  

If you get the data right at the outset, you pave the way for a frictionless reconciliation process. With the data right, you can standardise parts of one process that can be repeatedly used in other processes, creating further efficiencies. That also makes for happier employees and enabling you to make the most of your highly skilled, and valuable staff. 


We are all familiar with the phrase ‘doing the same thing time and time again and expecting a different result is definition of insanity’So, it’s time to stop going for your usual type, pay attention to the data, and let the actual process play second fiddle for a change. 

With your data automation house in order, all the process automation functionality you need sitting under one roof, you might just find your matching rates made in heaven. Step away from the disappointment of low match rates and swipe right for Xceptor.