Can you afford Compliance?
The ever-increasing complexity of compliance for financial institutions - and what to do about it?? ??
Stay on top of payment trends with Rivero. ????
? Why talk about compliance?
→ Maintaining compliance is fundamental to a Financial Institution’s ability to provide services. However, there is a difficult balance in managing compliance while investing in innovative, customer-centric and competitive capabilities.?
→ According to Lexis Nexis, the cost of remaining compliant is highest in the UK and Europe, being on average three times greater than in North America and APAC and up to seven times higher than in LATAM. Therefore, the cost of compliance has a material impact on the budget that a financial institution has available to spend on improvements to its service, expanding its market, reacting to competition, improving customer experience, and growing its revenue.
→ While recognising the impact that managing and maintaining compliance has on a financial institution, integrating compliance with the overall digital strategy allows financial institutions to 1) minimise risk (e.g., financial crimes, non-compliance fines) and and 2) provide a platform for offering innovative services to their customers – all driving growth while optimising the handling of compliance obligations.
? Why managing and maintaining compliance is becoming more challenging??
→ The Thomson Reuters 2020 Cost of Compliance survey states that keeping up?with regulatory change was a top compliance issue.
→ This issue stems from an increase in the number and frequency of updates to regulatory and industry-driven standards; as a result, making the process complex,? expensive and prone to mistakes and overlooked compliance.?
→ In addition, as Fintechs expand their play in the financial ecosystem, regulators are increasing their focus on the role of Fintechs and the level of regulation they require - also for financial institutions that incorporate their services.???
? How to tackle this??
→ To financial institutions, compliance is usually handled as an operational cost, with the approach to perform the necessary changes cost-effectively.?
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→? Financial institutions that incorporate compliance into their strategy can take a longer-term view, ensuring that compliance becomes an enabler rather than a cost centre.?
→ While the initial costs of incorporating a clear and defined compliance process into the strategy may initially be higher than undertaking the minimum changes to remain compliant, the longer-term benefit outweighs the initial cost differences.?
→ Taking such an approach usually reduces the ongoing compliance costs, complexity and risks, allowing the Financial institution to focus on their core business and customers.
→ Working with strategic partners who can provide regular compliance updates reduces the overall cost of the process and, more importantly, the complexity and risk.?
? How can Rivero help with the compliance topic???
→ While compliance for Financial Institutions is a vast topic, a large part of it is related to compliance with the changes and requirements communicated by payment networks, such as Mastercard and Visa.?
→ With our SaaS product, #Kajo, we help Issuing Banks & Acquiring Institutions manage this part of the compliance without manual processes, reducing the overhead and time invested in organising the work to remain compliant.
→ Kajo also enables service providers & Fintechs to directly and independently receive all updates or changes from the payment network that can impact their business and, as a result, ensure Financial Institutions which incorporate their services.
Do you want to know how it works? ???? Kajo - Rivero
Link to the study: https://bit.ly/3kBcdeg