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What is AI Document Digitization?

Despite the growth of electronic content, organizations of all sizes are grappling with lots of information that arrives via physical documents. High volumes of physical documents are enough to overwhelm many organizations. But collecting, processing, storing, and safeguarding physical documents creates big headaches in terms of productivity, decision-making and control.

Document digitization with artificial intelligence (AI) – solutions that use cognitive technologies to convert physical documents to digital format – reduce the burden of managing physical documents, improving efficiency, saving time, increasing accuracy, and enabling digital transformation.

The global market for AI document digitization will reach $15.2 billion by 2026, analysts estimate.

This article shows how AI document digitization works and the benefits it provides organizations.

What is AI document digitization?

AI is technology that automates cognitive processes that previously required human intervention.

AI document digitization uses AI to convert physical documents into an electronic format.

Natural language processing and other AI technologies extract, analyze, and interpret the meaning of content within documents, making it easier to process, route, and retrieve content. Machine learning allows AI solutions to continuously learn and adapt to new document types and formats. And predictive analytics analyzes vast amounts of data to uncover trends, potential trends, and anomalies.

AI impacts the entire document digitization process:

  • Document enhancement, contributing to the creation of high-quality digital images.
  • Data capture, converting the data from physical documents into machine-readable text.
  • Document classification, digitally categorizing documents based on their content.
  • Workflow routing, systematically routing documents for approval and processing.
  • Search and retrieval, allowing for the fast search and retrieval of specific information.

Organizations in finance, healthcare, government, business process outsourcing, and other industries can benefit from converting physical documents into digital content using AI-powered solutions.

How AI document digitization works

When combined with document scanning, intelligent data capture, and other digital technologies, AI can play a big role in helping organizations convert physical documents into electronic format.

  • Capture. When combined with optical character recognition (OCR) and other data capture technologies, AI uses natural language processing and other tools to convert the printed or handwritten information on physical documents into editable and searchable digital content. Data fields such as customer name, date, amount due, and address are AI even learns from its mistakes over time to deliver increasingly better data capture results.
  • Enhancement. High quality images are critical to achieving optimum data capture results and complying with standards for information retention. AI analyzes document images to correct distortions such as skewing, remove speckles and other noise, and enhance images.
  • Classification. AI uses sophisticated machine learning and deep learning algorithms to analyze the content on vast amounts of documents and automatically sort them into preset categories of documents, such as orders, invoices, applications, and correspondence. AI can learn from patterns and user feedback to deliver better classification results over time.
  • Validation. Manually cross-referencing the data extracted from physical documents with information residing in a database or system of record can be time-consuming and error prone. AI reliable and quickly validates extracted data based on predefined business rules.
  • Routing. AI uses preconfigured business rules and the actions it observes staff taking over time to systematically route documents, assign tasks, and resolve approval exceptions.
  • Retrieval. Natural language processing and other AI technologies make it easy to search vast amounts of content stored in a digital repository to instantly retrieve documents.

These are some of the ways that AI improves the digitization of physical documents.

The benefits of using AI in document digitization

AI document digitization offers several benefits to organizations across industries.

  • Improved efficiency. According to Gartner, AI can automate 80 percent of the tasks involved in document digitization. From data capture and document classification to routing and retrieval, AI document digitization reduces the need for manual intervention.
  • Faster cycle time times. AI can process vast amounts of data faster and more accurately than human operators, and the technology can do it 24/7/365, avoiding potential delays.
  • Higher accuracy. According to the Association for Intelligent Information Management (AIIM), AI can improve the accuracy of document digitization by 95 percent. AI significantly improves upon the data capture accuracy provided by OCR and learns from patterns and actions taken by users over time to continuously improve its accuracy.
  • Better scalability. By automating tasks that required human operator intervention, AI frees back-office staff to focus more time on higher-order activities that help grow the business and enables organizations to scale their operations without the need to hire additional staff. And AI can quickly adapt to new document types and formats, to meet changing business needs. Forrester estimates that AI can reduce the cost of document digitization by 50 percent.
  • Enhanced security. AI analyzes patterns and historical data to identify anomalies that may indicate fraudulent or non-compliant activity. Transactions can be flagged for human review.
  • Intelligence. AI can provide predictive analytics for decision-making and planning.

These benefits make AI a powerful tool for document digitization.


Organizations must find ways to efficiently manage the content they receive via physical documents. The sophisticated algorithms in AI document digitization solutions enable organizations to unlock the full potential of their information by extracting, analyzing, and interpreting the content from physical documents, adapting to changes in documents and formats, and delivering smart, predictive insights to stakeholders. With AI, organizations can complete the ‘last mile’ of document digitization.

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