The Model Office Blog

Applying Einstein thinking and RegTech

[fa icon="calendar"] Sep 13, 2019 10:44:26 AM / by Chris Davies

Current compliance methods still tend to be reactionary and employ checklists and tick box approaches. This is like driving car through rear mirror and it just creates the same problems, as Einstein said we cannot solve problems with the same thinking used when we created them, so a move away from ‘swivel chair' compliance using disparate, tick box solutions to a joined-up journey requires different thinking which is pro-active and strategic in approach.

The Retail Distribution Review, for those who remember that far back,  has done decent work on individual professional practice but there is now hard regulatory focus on the firm professional practice in placing customer interest first and foremost, So how you are identifying, assessing and implementing good conduct across your business is imperative but not easy, just look at the Senior Managers and Certification Regime implementation and MiFIDII PROD and Cost disclosure requirements implications.

5 Conduct Risk Questions

Conduct and competence isn’t just about fines or misselling, it’s about competitive advantage. The FCA’s 5 Conduct Risk Questions Projectshows, by assessing, managing and monitoring your staff competence and conduct you can benefit from low direct and indirect compliance costs, high client engagement, attractive for mergers and acquisitions and providing networks with a better handle for which firms to on-board and those that are performing well and those that require more support.

Streamlining Compliance

One thing is for sure it is raining regulations. So, it is those firm owners and compliance managers who employ RegTech when facing an increasing number of regulatory requirements who are better able to streamline compliance, improve effectiveness, enhance customer experience and reduce the risk of compliance failures, ultimately giving firms competitive advantage over new market entrants. The strict industry-wide regulations mean that banks and financial services firms cannot afford to overlook compliance and risk management.

Financial institutions are looking at suitable solutions which provide immediate results and comply with the latest regulations, making the compliance process easier to manage. This is how RegTech can help, by creating cost-effective, automated regulatory compliance solutions, making life easier for compliance professionals required to meet regulatory requirements, whilst at the same time increasing profitability.

Tangible benefits from RegTech include:

  • Increased revenue
  • Lower costs
  • Greater efficiency
  • Reduced risk

A large extent of RegTech is focused on compliance in the financial services industry and an increasing number of institutions will be focused on RegTech solutions to manage compliance and regulatory requirements. However, as the sector evolves, its potential will drive machine learning towards supporting complex decision-making and greater profitability.

Please click the below icon link to MO®'s #RegTech platform and learn more about MO® today..

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Topics: Financial regulation, Financial business development, fintech, regtech, Risk management, practice management, FCA, advice, HMT, suitability, FAWG, FAMR, MiFIDII, SMCR, Data, GDPR, Chatbot, Culture, Enforcement, supervision, audit, Conduct, AI, Risk,, Accountability, Platforms, PROD, Product governance, digital,, Regulatory, Reporting

Chris Davies

Written by Chris Davies

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