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3 compliance challenges for Banks that can only be resolved by Technology

The conventional business model of banks is under strict pressure from fierce competition as well as compliance regulations that require banks to invest more in enhancing overall customer experience. Challenger banks that rely on modern age technology and have lesser compliance regulations to follow are expected to collect deposits beyond 32.6 Billion US Dollars. It means that the sum collected by these banks is 82% higher when compared to the previous year. Experimenting with technologies is the only way that can help the banking sector to avail a steady cash flow in the form of cash deposits without having to worry about undercut by smaller but more efficient banking organizations. The most important aspect in which technologies can enable banks to improve their overall performance is via compliance adherence.

Admit it, most of the banks have seen their revenues being cut down only because of their compliance based penalties. After all, multi-million dollar fines are something that cannot help to negotiate a satisfactory profit report.

Here are the 3 compliance challenges that can only be tackled by global banks by the increasing use of tech-based solutions.

Anti Money Laundering Compliance

The banking industry has come a long way from the times of BCCI and being directly involved and exploited by criminals for money laundering activities. AML compliance is now mandatory to be performed, but unfortunately, most of the banks are still stuck with manual compliance overview. Several AML software for banks are available these days that can digitally monitor the banking activities of millions of banking customers. Red flags start going up as soon as the transactions start becoming shady. Surely, AML screening can be performed in much less time and with much more success with the help of AML compliance solutions available these days.

Financial Risk Assesment

The term open banking is thrown around quite a lot but the biggest benefit of tech-powered banking is the actual assessment of financial risk attached to any individual or corporate entity. More often then banks would like it, they are caught in the cross-fire between 2 corporations, with each party blaming the banking services is not able to safeguard them from potential dangers of the partnership. Using distinctive targeting of data points and financial data, a risk statement can be generated in real-time that can help businesses to measure the overall feasibility of continuing to serve any number of clients.

User Verification

KYC compliance is not something new for banks these days but most of them are only limited in their approach of collecting user information. Some even attach the mandatory clause of attaching an authentic identity document but the banking staff or automated systems of banks lack the right expertise to check the authenticity of personal information provided by their customers. Only a reliable KYC service provider that understand the regulatory guidelines of collecting personal information from end-user can truly help banks to perform KYC verification without compromising the overall privacy of their customers or exposing them to unrestrained risk.


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