How Fintech Is Affecting Compliance Risk
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The rise of fintech companies has presented many new challenges across the financial industry, from capital markets and financial services, to regulation. One such area that has had to re-think how they operate is compliance.
A study released this week by Accenture confirmed that, saying that compliance departments may be forced to rethink their operating models if they want to stay ahead of the changing landscape.
Accenture surveyed leading compliance officers at 150 banking, insurance and capital markets firms, and concluded that while compliance departments have "kept their seat at the table" for now, changes in fintech have posed unique challenges.
"The fintech industry has created new products and ways of doing business that the compliance function in traditional financial services firms has not seen before," said Rafael Gomes, an executive in Accenture Finance & Risk Services. "For example fintech has facilitated new ways to bank digitally - not only checking balances online, but applying for loans and other credit products via mobile phones, making payments via smartwatches, etc. Compliance needs to ensure that the right controls are in place across these new digital media."
How would they do that? By showing greater involvement in advising companies on new products, product governance committees, and solidifying their link to human resources as cultural changes slowly spread across the industry.
Gomes noted two key priorities when it comes to compliance: staying up to date in emerging technologies and businesses, and incorporate those very same innovations into the compliance environment.
"Using new technologies can help to sensitize Compliance executives to how the industry is changing more broadly," he said, specifically singling out the fintech firms Digital shadows and Digital Reasoning, which are working towards that very goal.
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