Financial Services

Using Data & Tech For Regulatory And Compliance Initiatives [With Examples]

The data that SoFi leverages enables the company to be quick and efficient – two things that people value in companies. However, the data and technology that make SoFi successful also addresses some of the regulatory concerns by essentially forcing it to be blind to applications.

Data is helping financial institutions with tasks like identifying trends in compliance. Brian Chin, managing director and CEO of global markets at Credit Suisse, recently shared how the firm is using data for compliance purposes. Specifically, the company has partnered with Palantir Technologies, the developer of a leading data integration platform, to help identify rogue traders. By analyzing data (such as when an employee enters the building and logs into a computer), trading patterns, and suspicious behaviors, Credit Suisse has been able to eliminate problems and reduce risk, whether by remediating issues or even terminating employees.

Most banks are working on similar initiatives, whether by developing their own systems or outsourcing data mining. If financial firms can get this right, they can run much more compliant businesses, which will lead to better bottom lines. It is about prevention rather than reaction after an issue surfaces. While the industry is making progress, it is still scratching the surface when it comes to leveraging the data at our fingertips for use in compliance initiatives.

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Whether regulators can keep up with technology, the growing amount of data, and the new methods that help keep firms in compliance is a question that often floats around the industry. Many experts will tell you that the industry as a whole is moving too quickly for regulations, and that banks continue to face significant costs stemming from regulatory burdens. Yet the ability to significantly cut regulatory, infrastructure, branch, and personnel costs already exists.

While the general belief among industry experts is that too many regulations exist, many leaders, including Louise Pentland, executive vice president, chief of business affairs and legal officer at PayPal, remain complimentary of regulators’ desire to protect customers and learn about new methods for improving compliance. She said that regulations are, in fact, becoming better. However, we must continue educating the regulators. We must continue collaborating with them. If companies do not collaborate with regulators, the result could be stifled innovation.

Using anecdotes and commentary from company executives, we wrote a guide that explores the state of the financial services industry as it pertains to the impact that data and technology have on innovation, regulatory and compliance, customer service, and human labor. From these very examples and our active work in the industry, we highlight several trends that we expect to continue to transpire in 2018.

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Sr. Marketing Manager, Industries, Perficient

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