In part 1 of this vlog series, you learned about what RegTech (Regulatory Technology) is and why it’s important for financial services. Part 2 covered the biggest achievements in RegTech over the past year, what the future holds for RegTech, and the next steps your organization should take to be successful. Part 3 discussed the new regulations to watch for and the nature of the changes. Part 4 will go into more detail around how internal roles are changing as technology advances, the biggest challenges for compliance, the challenges Chief Technology Officers (CTOs) face, and how financial firms can work together to solve common problems.
How Are Internal Roles Changing?
As technology advances, internal roles will change. Role functions that are currently very manual and tactical will gradually be taken over by automation. But, it’s important to note that intellectual human capital is critical in ensuring that the process or machine does what it’s supposed to do. Therefore, we’re going to see a lot of job functions diverting from what they currently do, enabling employees to put more energy into critical business activities. You’ll also see organizations moving away from traditional siloed approaches.
What Are the Biggest Challenges for Compliance?
Some of the biggest challenges for companies are that many of their compliance departments are fighting off an onslaught of different regulations coming down the line. There are also a lot of technology advancements, so things such as artificial intelligence (AI), blockchain, and machine learning, are starting to create challenges. Even though the technologies are not yet regulated, they soon will be and people need to get their heads around that. What you’ll start seeing are a new super breed of compliance offices that need to not only understand the technology and the regulations, but how they can interact together. That’s one of the key challenges RegTech can help organizations solve. Hitachi Vantara uses RegTech to help organizations bridge the gap between technology and the line of business, bringing both together.
What Are the Challenges for CTOs?
The biggest challenges aren’t just faced by CTOs, but by the entire C-suite as a whole. Everyone in the C-suite is responsible and accountable for certain things in certain areas within the organization. As this digital disruption approaches, it’s critical that key stakeholders are broadening their scope and gaining a better understanding of the type of challenges they’re going to be facing. They need to know where their data lies, where the lack of knowledge is within the organization, and ensure they understand enough about the regulatory impacts. If they don’t, they need to engage with their compliance department. There are a lot of challenges coming down the line, and these challenges aren’t going to hit just one segment of the organization, it’s across the board.
How Can Financial Firms Work Together to Solve Common Problems?
It’s not just about financial firms working together to solve common problems, but about the whole financial services ecosystem coming together. The entire ecosystem is going to be impacted and they need to sit around the table, and through collaboration, identify what the problems are, talk together, and be able to solve for various challenges. This type of approach is best because it helps organizations break out of their siloed ways of thinking.
Coming out of these siloes will enable financial firms to see the wider problem and wider picture. For example, if the compliance department has a challenge which requires an IT solution, this approach will allow the compliance person to understand IT’s challenge and why they might not be able to solve their problem. It helps overcome barriers so the compliance department, for example, isn’t just handing IT the regulation and telling them to build a solution for it, while IT doesn’t necessarily understand why the solution is needed.
These discussions need to be open and public, not just within organizations, but across the entire ecosystem. This is critical because each part of the ecosystem is going to be impacted.
Check back for more vlogs around RegTech and why it’s important for the financial services industry in our 5-part vlog series.
How Hitachi Vantara Can Help
With regulations constantly changing and data volumes rising, many of the largest financial institutions are looking to Hitachi Vantara for actionable insights into customers, operations, and risks. Learn more about Hitachi Vantara’s RegTech solutions here.