Legal tech in financial services - shift into a high gear

Just as cycling enthusiasts relish the freedom and efficiency of a well-tuned bike, legal professionals can experience similar thrills by harnessing the power of advanced legal technology. Whether you're pushing through uphill battles or cruising through routine processes, the right tools make all the difference in your daily ride through legal landscapes. Navigating your legal work doesn't have to feel like a grueling mountain stage in the Tour de France.

AI pedal power is driving legal tech investment

In 2023, the legal technology sector experienced significant trends and changes. The adoption of generative AI surged, highlighted by the integration of tools like GPT-4 into legal practices, enabling advanced document analysis and automation. Despite a decline in legal tech investments and mergers due to economic uncertainties, notable deals, such as Thomson Reuters’ acquisition of Casetext, underscored the strategic focus on AI technologies. Additionally, the legal industry grappled with hybrid work models and regulatory debates on nonlawyer participation, reflecting a broader shift towards innovation and flexibility in legal services.

There were, however, some notable investments. The UK government announced a multi-million-pound investment to boost technology in the legal sector, aiming to make legal services more efficient and accessible through innovation. This funding is expected to drive growth and improve the legal industry's global competitiveness by adopting advanced technologies such as AI and blockchain​​. Concurrently, Definely, an AI-driven legaltech startup backed by Microsoft and Google, raised $7 million to enhance its AI-powered legal document tools and expand into the US market. This reflects a broader trend of substantial investments in legal tech to streamline legal processes​​.

Legal operations require fast lane tech

The legal operations function focuses on enhancing operational efficiency by incorporating allied professionals into the legal department. These tech-savvy experts bring process re-engineering experience and drive the adoption of enabling technologies, articulating their value in business terms. Financial services highly value legal ops, with an average team size of 11 professionals, significantly above the cross-sector average of seven. This underscores the confidence in and importance of legal operations within the financial sector, as highlighted by the CLOC report.

Benefit for legal professionals in financial services

There are great benefits to keeping your legal tech stack up to date, many of which can be encapsulated under one banner; making legal professionals more efficient to save them time. Data security is of course a big consideration, but this often falls down to the IT function rather than legal professionals using tech systems on a day to day basis.

Here are five key benefits legal professionals can expect to receive: 

1. Managing risk and compliance

Legal tech tools enhance risk management and compliance by providing full visibility and automated processes. This is crucial in sectors like banking, which operate under strict regulatory environments. Contract lifecycle management (CLM) systems ensure that all agreements contain updated, approved clauses, which helps in maintaining compliance with both internal and regulatory rules.

2. Simplifying financial statements

Legal tech can simplify and standardise financial statements, making them easier to manage and audit. This is achieved through automation and improved document management systems.

3. Reducing internal costs

AI-based legal tech solutions, such as the recent iManage AI features, can significantly reduce internal costs by automating repetitive tasks, improving efficiency, and reducing the need for manual intervention in financial transactions.

4. Accelerating processes 

Legal tech can accelerate various processes within financial institutions. For example, contract automation can speed up the negotiation and approval phases, freeing up staff to focus on higher-value tasks.  Sysero, for example, can support specific Know Your Customer processes to streamline AML checks. Ultimately, streamlining internal processes enables the business to focus on what matters most; the customer. 

5. Managing legal spending

By integrating specialised procurement tools and automating contractual workflows, legal tech can help financial institutions manage legal spending more effectively, enhancing process management and operational efficiency.

• See our full range of financial services legal tech solutions. 

Legal tech broken down by solution

Document Management System (DMS)

Example: iManage
Features: A strong DMS often underpins many other legal tech systems. iManage is designed for legal professionals and consolidates matters and business content into one repository. 

Document drafting and comparison

Example: Litera
Features: Litera offers a suite of tools to streamline document handling for legal professionals. These include Litera Metadact for metadata cleaning and security, pdfDocs for efficient PDF editing and redaction, and Litera Compare for seamless document comparison. Integrated with iManage Work and Microsoft 365, these tools enhance collaboration, ensuring accuracy and productivity in managing sensitive legal documents.

Matter management 

Example: Lawcadia
Features: From intake and triage, to RFP and spend management, and invoice and billing, a matter management solutions can cover many requirements from the legal process. 

Case management software:

Examples: Clio, MyCase, PracticePanther
Features: Manages client information, case files, deadlines, billing, and documents. Integrates with calendars and email systems. These platforms provide a centralized hub for all case-related activities, helping law firms stay organized and ensure compliance with deadlines and regulations.

Contract Lifecycle Management (CLM):

Examples: Agiloft, Conga, Icertis, LawVu
Features: Manages the entire contract lifecycle from initiation, authoring, negotiation, approval, execution, performance tracking, to renewal or expiry. CLM software enhances contract visibility and control, ensuring compliance, reducing risk, and improving operational efficiency.

Document automation:

Examples: SmarterDrafter, HotDocs, Contract Express, DocuSign
Features: Automates the creation of legal documents based on templates, reduces repetitive tasks, ensures consistency, and allows for electronic signatures. This technology helps lawyers save time on routine paperwork and reduces the risk of errors, enhancing efficiency and accuracy.

Legal research tools:

Examples: Westlaw, LexisNexis, Fastcase
Features: Provides access to legal databases, case law, statutes, and legal periodicals. Advanced search functionalities and AI-driven insights help legal professionals quickly find relevant information and precedents, improving the quality and speed of their legal research.

e-Discovery tools:

Examples: Relativity, Logikcull, Everlaw
Features: Helps manage the electronic discovery process, including the identification, collection, and analysis of electronic documents for legal cases. These tools are crucial for handling large volumes of digital evidence in litigation, ensuring thorough and compliant discovery processes.

Practice Management Software (PMS):

Examples: Smokeball, Actionstep, Zola Suite
Features: Combines case management, document management, billing, and client relationship management in a single platform. This all-in-one solution supports the administrative and operational needs of law firms, improving workflow and client service.

Contract management software:

Examples: Ironclad, ContractWorks, Concord
Features: Manages the lifecycle of contracts, from creation and negotiation to execution and renewal. Provides alerts for key dates and compliance issues. This software ensures that contractual obligations are met and risks are mitigated.

Billing and accounting software:

Examples: TIQ Time, TimeSolv, Tabs3, QuickBooks for Lawyers
Features: Manages time tracking, billing, invoicing, and accounting specifically tailored for law firms. These systems streamline financial management, ensuring accurate billing and helping firms maintain financial health.

Legal analytics and predictive tools:

Examples: Lex Machina, Premonition, Ravel Law
Features: Uses data analytics and AI to predict case outcomes, assess legal strategies, and identify trends in legal decisions. These tools help lawyers make data-driven decisions, optimize strategies, and anticipate case results.

The list goes on...

Confused?

You're not alone. Due to the complex and interdependent nature of solutions, knowing where to start is challenging. In fact, choosing the wrong solutions can result in a costly implementation fail, to the extent that Gartner predicts that by 2024, 50% of first-time CLM implementations will fail to deliver on expected benefits. 

This is where we add value. Firstly, we establish what the business needs and therefore the objectives for any solutions. Then, as a vendor agnostic partner, we review the market and propose relevant solutions based on the brief. Legal tech done correctly!

Book a DMS discovery call today 

Ascertus offers tailored legal tech solutions specifically designed for financial services, ensuring seamless integration with your existing systems. Benefit from our comprehensive support and training to enhance your compliance capabilities and protect your most sensitive information.  

BOOK A DISCOVERY CALL

See also:

• Securing sensitive financial data with robust DMS features
• Financial services document management : strategic alignment
• View the full range of Financial Services solutions.

FAQs

What is the future of legal tech?

The future of Legal Tech is set to transform the legal industry through advancements in AI, blockchain, and automation. AI and machine learning will streamline legal research, contract analysis, and predictive analytics, while automation will handle routine tasks, improving efficiency and reducing costs. Blockchain will enable secure, tamper-proof smart contracts, and AI-powered virtual assistants will enhance client service. Advanced data analytics will improve case management and decision-making. Online Dispute Resolution (ODR) platforms will make dispute resolution faster and more accessible. Robust cybersecurity measures will protect sensitive data, and client-centric solutions will focus on user-friendly platforms and improved communication, revolutionizing traditional legal services.

What is LawTechUK?

LawtechUK is an initiative established to promote and accelerate the adoption of technology within the UK's legal sector. Supported by the UK Government and operated by Tech Nation, LawtechUK aims to drive innovation, improve efficiency, and enhance access to legal services through technology. Key components of LawtechUK include:

1. Lawtech Sandbox: A program providing support and resources for legal tech startups and innovators to develop, test, and scale their solutions in a controlled environment.
2. Collaboration Network: Connecting legal professionals, tech experts, and regulators to foster collaboration, share knowledge, and address common challenges.
3. Research and Guidance: Producing research, reports, and guidelines to inform the industry about the latest trends, best practices, and regulatory considerations in legal technology.
4. Skills and Training: Offering training programs and resources to upskill legal professionals in using and understanding technology, ensuring they are equipped to leverage new tools and platforms.

LawtechUK aims to modernize the legal sector, making it more efficient, transparent, and accessible for businesses and individuals alike.