Compliance Tech In Banking & Finance Industry

The banks and financial services industries are dealing with a lot of regulatory compliance norms that are setup by the central banking body. The Reserve Bank of India (RBI) had put many penalties, fines that ran into crores, on various banks and financial institutions in 2021 that included 14 banks and NBFC. This created operational and revenue pressure for all financial players. Compliance is tough. Banks and FIs not only need to abide by these regulatory rules, but also need to keep up with the changing compliance rules at a fast pace. On the other hand, the Covid-19 pandemic has fast-tracked the need for technology innovation across the globe. The regulatory compliance plays a vital role in the risk management processes. There has been a huge change in the regulatory landscape, leading to an increase in the cost of compliance for banks and financial institutions. As per a research estimate, banks and financial institutions are spending around $270 Billion on risk and regulatory compliance related activities, out of which $128 Billion/year is been spent on technology. The Banking & Financial Services industry are moving at a faster pace to automate their compliance process framework. To address different challenges by the new regulatory environment, banks and FIs are leveraging technologies like AI, RPA to make regulatory calculations and compliance scalable, easy-to-manage, interactive, and less costly for their business. Therefore, usage of advanced technologies can reduce the burden for banks and FIs to have a better compliance track record.