Banking Compliance Automation: Benefits and Examples

The importance of compliance in banking

Compliance will always be a core responsibility for banks, with a direct impact on your reputation in the industry. When executed effectively, it can build trust among your consumers. When neglected, it can result in a damaged reputation and penalties. The Financial Times reported that ‘global fines for failing to prevent money laundering and other financial crime surged more than 50 per cent last year’, highlighting the need to implement strict compliance procedures to protect financial instituitions and their customers.

But maintaining compliance is often complicated. Today, compliance and cybersecurity remain the top risks to banking and investment services firms. This is because of the difficulty of keeping up with:

- Changing regulations
- Unreliable data sources
- Upskilling team members
- Rising costs
- New security threats
- The increasing customer expectation for faster service

Many leading banks and investment firms are turning to automation to take control of their banking compliance, from SOX to GDPR. Here’s why.


How automation simplifies banking compliance

Banking compliance automation provides an effective, reliable, and scalable way to detect and address any irregularities or issues in your organization's operations. Time-consuming manual processes can be replaced by consistent low-code technology, simplifying how you comply with all internal and external regulations.

Here's how automation can both help your business maintain compliance and drive efficiency at every level.

Build a compliance-first approach for risk mitigation: When it comes to compliance, you don’t want to be playing catch up. Automation bakes compliance into all your processes so you can proactively mitigate risks, ensure ongoing compliance, and keep up with changes in regulation or business demands.

Automated audit trails and regulatory reporting: One of the huge benefits of automation platforms is that all data is recorded and leaves an audit trail, so banks can prove compliance through reports, without having to spend time manually gathering data. They can generate audits and regulatory reports quickly and accurately, helping to avoid fines for late or inaccurate submissions. 

Improved data accuracy and management: Using an automation solution to unite data makes it easier to maintain compliance and increases visibility. This helps to improve data analysis and reduces the chance of data discrepancies, so you can rest assured that your regulatory reporting is accurate.

Embracing hybrid: Implementing automation doesn’t mean you have to say goodbye to your legacy systems. Taking a hybrid approach means you can continue to draw data from your older systems and write back into them. As a result, you can be more agile and flexibility to your business needs.

Transparency for a collaborative approach: Automation helps you combat the fragmentation of people, data, and processes across an organization. Your teams will have access to a unified view of systems, with appropriate guardrails in place. This not only aids compliance by standardizing data access, but also enables better collaboration business-wide.

Reducing costs: Compliance is a big expense for banks. Ensuring that processes are followed and data is protected is time consuming but crucial to managing risk when it comes to legal action, fines and reputational damage. Automating compliance procedures increases efficiency, lowers risk and reduces the need for human intervention in key processes.


Banking compliance automation: 3 industry examples

Automating data-based tasks to improve SOX compliance

Bancolombia is a leading Latin American bank. They use low-code technology to automate the steps required for SOX compliance which requires all public organizations to run annual audits and demonstrate evidence of responsible and accurate financial reporting. Through automation, they increased service efficiency by 59% and reduced risk by 28%.

Ensuring GDPR compliance and taking control of customer data

A leading bank in Eastern Europe recently implemented low-code technology to act as a repository of consent, providing visibility over the information held on over one million customers. Along with meeting GDPR compliance, this boosted their efficiency by replacing manual tasks with automation to unify data from eight separate systems.

Demonstrating compliance with process automation technology

Stone Coast Fund Services, a leading hedge fund administrator is using process automation to ensure compliance for its large cash transfers process. When moving tens of millions of dollars at a time, automation ensures all the appropriate checks and balances are in place. The system also lets them demonstrate their due diligence to an official body if they were to face an audit or investigation.


Implement and demonstrate banking compliance with automation

Businesses in the banking and investment sector can harness the power of automation to connect systems and increase visibility to become more efficient, secure, and compliant.

Learn more about Bizagi’s range of banking solutions and how we can help transform your operations with low-code automation.