AI OCR for intelligent document processing

Konfuzio

With the help of artificial intelligence, OCR can be taken to a new level of evolution. This advance in document processing allows documents to be automatically scanned, categorized, and converted into meaningful data. Companies with large administrative workloads will benefit enormously from this development. In this article, we answer the most important questions about OCR with AI and the changes brought about by artificial intelligence.

What is OCR?

OCR stands for Optical Character Recognition and is not a completely new invention. As early as the 1990s, the technology made it possible to digitize contracts, invoices and the like. However, since manual transfer work was still required to convert physical text into digital text, interest in OCR flattened out somewhat after the turn of the millennium. Now the technology is gaining in importance again. This development is being driven by technical progress in the field of artificial intelligence, which is creating new possibilities for optical character and text recognition. 

A traditional OCR system basically represents a software that digitizes documents. The goal of the system is to scan the content and text of a physical document and recognize the imaged text and handwriting. The captured data can then be used for further processing.

What is ICR?

The next step of development was rule and layout based OCR software: ICR Intelligent Character Recognition. With this method, patterns are created for different document types and different senders that define the layout of the invoices. In this way, the system knows which data can be found at which points in the document and can transfer this data automatically.

This further development is a great relief, but it is very error-prone. Many forms do not fit the predefined layout rules. Thus, a manually created template with individually defined rules is required for almost every new customer. The transferred content must also be checked and adjusted frequently.

What is IDP?

Intelligent OCR software with AI represents the state of the art and combines various technologies and functions. It uses algorithms that analyze the content regardless of rules or the layout of the documents to determine what information should be captured. The system recognizes what type of information it is and can extract the important data from the scanned documents. This has multiple benefits for companies: Resources can be saved and employees can be relieved by taking over repetitive tasks.

This state-of-the-art form of character recognition is called IDP, Intelligent Document Processing. By combining OCR and artificial intelligence, work that previously had to be done laboriously and manually by hand can now be read in and checked for errors by AI tools independently of a human user. In practice, this applies above all to the transfer of the content of scanned documents, which previously had to be done manually. 

OCR, ICR and IDP at a glance:

OCRICRIDP
Document digitization
Rule- and layout-based transfer of content
Learning transfer of the contents

Where is OCR with AI (IDP) used effectively?

As OCR with AI (IDP) is a solution for professional document processing, it can be a relief for all industries and organizations that have to cope with a high amount of document processing and archiving. Especially there, repetitive and organizational tasks prevent effective work and tie up resources where they are not used very effectively. In combination with artificial intelligence, OCR can sustainably improve employee satisfaction and motivation. 

The wide range of possible applications and the high effectiveness of the readout results make it worthwhile for many companies to invest in this technology. OCR with AI can relieve employees and automate simple, repetitive tasks. For example, IDP applications not only read the text from scans, photos and e-mails, but also extract the technically relevant information from it and prepare it for further machine processing, for intelligent document capture. Typical examples that can be automatically read, categorized and assigned by combining OCR and artificial intelligence are:

  • Invoices & receipts
  • Payment advice
  • Energy certificates
  • Insurance policies
  • Vehicle documents
  • Salary statements
  • Rental agreements
  • ID cards

The automated processing of these documents optimizes a wide range of processes and reduces the workload of employees. For further processing, the read documents can be imported into the company's own DMS, CRM or ERP system. Interfaces to other target systems are also possible. This lean process simplifies the management and organization of documents enormously and is thus of particular interest to the following players:

  • Banking 
  • Insurance
  • Company
  • public sector

How does IDP work in practice?

IDP systems recognize, read and categorize content from documents and process it into structured information that can be further processed digitally for business purposes. For this purpose, the documents to be read are copied into the IDP application and the text is read out within a few seconds. Interfaces between the IDP and the target system make it easy to exchange documents and data.

The employees then simply transfer the documents to the IDP application and receive the analysis of the evaluated documents as output. The software's text recognition recognizes content elements such as people, places, time and value specifications, and much other information from the documents. The data read out can then be checked and processed by an employee.

In this context, the software also serves as a distribution center that forwards the correct information directly to the relevant target systems. This enables better and faster decision-making by the users of the target system. The further information of the respective documents provides additional added value for searching in archives through their structuring and categorization. These are not lost as a basis for future, data-driven decisions.

The advantages of OCR with AI (IDP) at a glance:

  • Digital, automated processing of documents
  • Fast and reliable information and data transmission
  • Optimization of administrative processes
  • Conservation of resources
  • Satisfied, committed employees
  • Future-oriented alignment of the company

Banking example:

Everyday business in banking is very much characterized by the processing and archiving of documents: from checking identities and filing IDs to processing notary contracts, appraisals, leases or proofs of income, all of which contain important and sensitive data, many processes at a bank are characterized by these activities. Therefore, banking will serve as an example to illustrate the benefits of IDP. 

In addition to the large volume of documents to be processed, banks are faced with another major challenge: a plethora of legal requirements must be met at all times and are regularly monitored by legislators and BaFin. Different papers are required for different processes and these are archived for different lengths of time. Here, it is important to work carefully and minimize errors. Nevertheless, time is also often a pressing factor. In the case of loan applications, for example, all the necessary documents have to be scanned and processed quickly and without disruptions. Only in this way can the customer receive information about his request as quickly as possible.

In practice, applications often comprise many pages, documents and attachments, which are submitted in many different document types: As a letter, attachment to mails, by fax or simply as a cell phone photo. When documents are processed manually, this type of submission costs valuable time and is a frequent source of errors. OCR with AI supports the fast and error-free reading of different document types and provides a further argument for the use of IDP in banking.

Reducing tedious administrative work not only optimizes internal company processes, but can also be a decisive factor in promoting employee commitment and satisfaction. In this way, fluctuation can be reduced, know-how retained within the company's own organization, and costs saved. IDP is a topic with a future. By linking OCR and AI, resources can be saved sustainably and employees can be used better and more effectively.

Conclusion:

The combination of artificial intelligence and OCR is revolutionizing document capture and management. It offers many organizations a fast and reliable solution for handling applications and processing documents. The ability to understand documents and translate them into intelligent information makes these tasks easier and reduces the burden on employees. In many industries, this technology will have a significant impact on work and business success.

As a modern company that is aware of the challenges of the current era and digitization, there is no way around OCR with AI (IDP). Complex and time-consuming processes can be automated and simplified. This saves costs and resources and also has the potential to increase employee engagement and retention. Automating repetitive tasks also frees up valuable employee resources that can be used more wisely and effectively elsewhere.

By using intelligent software, many companies are supported in their administration, accounting and organization. They benefit from a digital process optimization and the automated readout of documents. In the process, the IDP software can be individually adapted to the respective needs in order to achieve maximally effective results. 

The professional solution: Konfuzio

A solution that combines exactly these advantages and was developed specifically for the needs of banks, insurance companies and public organizations is the Konfuzio software. Konfuzio implements a fast and reliable readout, categorization and processing of the submitted documents in different languages and thus enables an optimization of these processes.

The data of the read documents is available to you within seconds in an uncomplicated way and can be further processed in your own ECM. Before the structured data is transferred, it is also possible for Konfuzio to apply further rules that fit the individual requirements of your company.

Konfuzio's AI software can be used via web browser and processes PDF, TIF, PNG, JPG and GIF formats. All these documents are reliably recognized by Konfuzio, which can quickly and accurately convert the text into high-quality information. The powerful machine learning solution can be implemented in the cloud as well as on-premise and can be trained for special AI models using Python SDK.Would you also like to use the advantages of OCR and AI to sustainably optimize the processes in your company? Then contact our team at Konfuzio without obligation and receive professional advice. Find out more about the Konfuzio solution  here.

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