Impact of Regulatory Changes in the Financial Sector
According to an article published on Thomson Reuters, the financial sector deals with 200 regulatory changes daily and these numbers are still increasing.
The financial landscape and the business models of financial institutions in advanced economies changed significantly in the run-up to the crisis. Financial institutions across the world, especially in advanced countries can largely benefit from adopting automation. Leveraging technologies like AI, machine learning and RPA is the key to adhere and adopt ever-changing regulations.
If we look in today’s marketplace, banks and other FIs have greatly expanded the scope of their services. From legalizing global transactions to approving Card Not Present (CNP) transactions, the financial sector has covered a long path but with this expansion, the financial sector has also increased the complexity of their activities and is now facing an ever-challenging and increasingly complex regulatory environment. On the other hand, state regulatory agencies, investors, legislators, and the general public are focused on institutions’ consumer practices and regulatory compliance performance more than ever due to increased fraud rates. In this highly challenging environment, compliance failure can result in financial penalties.
In an environment where boards and individual senior managers are increasingly being held to account for their actions, financial services firms will need to ensure they have the foresight, governance, skills and operational capabilities to adapt and respond effectively.