Regulatory activity is changing a lot in the coming months, for a variety of reasons. With new pieces of technology entering the market and a shift in mindset emerging throughout the industry, the banking sector must prepare themselves to meet operational resilience requirements as they change.
The introduction of new tech
Technology in the financial sector has always been present, but there have been major changes across the past years. Next-gen technologies such as machine learning and blockchain are already being implemented to a great extent.
However, with this comes a need for compliance and understanding as to what the limitations of the technology must be. It is not enough to simply integrate these systems and just let them flourish. There has to be a level of compliance established at the same time to keep both financial services and their customers safe.
As an example, IT systems that are not upgraded with compliance in mind might then pose a risk to overall operational resilience. It is not enough for a bank or payment provider to be digital-first – there has to be a dedication to compliance at the same time. IT breakdowns, migration failures, and cyberattacks are all urgent and potentially critical events that could impact both institutions and customers alike.
Changing work habits
Along with the rise of this new technology has come a major change in the workplace. The last two years have seen the introduction of many people choosing to work either from home or in a hybrid capacity – spending some days at home and some in the office. This then has further impacts on operation resilience.
The increase in the use of digital and cloud services plus certain volatilities in the market has meant that there has to be an increase in security that covers those who will be working from devices outside of the office’s security system. It has revealed certain strains on these services and highlights a need for further operational resilience and the implementation of new measures.
Whether these employees are working on a device provided to them by the company or they are on their own, there is still the risk of a breach. There needs to be firm regulations and compliance laid down so that risks can be minimised and employees can complete their tasks safely regardless of where they might be.
While a bank or payment provider should have a compliance officer on staff as standard practice, it might be worth looking into professional compliance consulting services too. There are so many details that must be accounted for when operational resilience is to be considered. A professional compliance consultant will be able to identify the changes that need to be made within the company and how to bring about workable solutions that can be implemented immediately.
One of the major advantages of using such a service also means that it can be ongoing rather than just something introduced across one day. Operational resilience needs to be monitored as part of a wider ongoing program of compliance. New changes arise in the world of finance all the time and banks need to be prepared to implement them whenever they arise. Using a third-party professional compliance consultant ensures that ongoing changes will be monitored so the firm can be fully compliant at all times, regardless of how drastic changes might be or how quickly they will need to be introduced within the company.
Make changes and start preparations now
This is one area that might be grey a little as there are still many changes that have to be introduced and implemented. As the rollout of tech such as blockchain continues, there will come new regulations and restrictions designed to strengthen the operational resilience of companies and firms using this fintech.
With this must come a commitment by such firms to become compliant as quickly as possible. This might go far beyond simply introducing a few changes here and there. Starting from scratch and building an entirely new framework is also not necessary. Instead, firms must work to transform their existing frameworks and policies to meet the new demands laid down in the best possible way. Banks and other corporations need to re-identify their most important business services and establish how they could disrupt consumers and market integrity. From here, a plan can be laid down that will best support operational resilience and minimise any potential harm and disruption.
The sooner that this can be arranged the better. A proactive, customer-centric approach is always the best one to use in such a scenario, and could help a firm to avoid many of the pitfalls thay might arise with improper preparation. Regardless of their current position and assets, all banks and payment providers need to take the time to correctly prepare to improve operational resilience in the near future.