As regulatory pressures continue to mount, what are the biggest priorities? Aveni, a UK-based RegTech platform, has outlined the top five things financial services CROs are currently prioritising.
The first area of focus is around budget cuts. It stated that one of the biggest challenges is balancing the need to manage growing risk with limited resources. As budgets are being cut, CROs need to do more with less, but it is making it difficult for compliance functions to keep up with the regulatory landscape.
To resolve this challenge, Aveni claims CROs are looking to technological innovation to find new ways to make the most of their current resources, rather than increasing headcount.
The next area of prioritisation is the increasing regulatory pressure. It stated that Consumer Duty, which has a deadline of July 31st, is just one of many significant regulations that CROs need to navigate in the coming years.
Despite the rising pressure, Aveni believes most organisations are not where they need to be in their implementation plans, creating high levels of uncertainty and urgency.
Next, Aveni highlighted the rising focus on vulnerable customers. It stated that the ongoing economic and energy crisis is pushing more and more people into debt. A survey from the UK’s FCA claims that 24% of UK adults have low financial resilience and 47% of UK adults show at least one characteristic of vulnerability.
This is putting increased pressure on CROs to ensure the organisation meets the needs of these customers. There are significant fines and reputational damage that can follow from not serving vulnerable customers properly, for example, the British Gas investigation for forcing prepaid metres on vulnerable customers. Due to this, Aveni urges firms to prioritise vulnerable customers.
Another priority for CROs is the need for greater risk coverage. It stated that a consequence of Consumer Duty is that firms are required to make deeper reviews into each case. This means each assessment takes longer and fewer calls are reviewed. Instead, AI technology can complete automatic assessments of every call and flag incidents.
Finally, CROs are prioritising the return on investment of investing in new technology. It stated that CROs are becoming more stringent in their requirements, demanding tangible proof of the ROI that new technology will deliver.
Through this, CROs are hoping to ensure tech investments deliver real business value, both short and long-term.
Aveni concluded, “CROs have their work cut out for them. However, with the right tools and tech, CROs can be well equipped to meet these challenges head-on and make good on ambitions to put data-driven strategies at the heart of their company’s operating model.”
Read the full post here.
Earlier in the year, Aveni explained how manual quality assurance is no longer sufficient for managing risk in the financial services space.
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