The Gist
- Streamline compliance. Regtech simplifies compliance, streamlines data processing and secures customer interactions.
- Enhance engagement. Leveraging AI and ML, regtech improves customer touchpoints and overall experience.
- Future-proof operations. Regtech enables organizations to adapt to regulatory changes and forecast future compliance needs.
In the fast-moving globalized world, compliance and regulatory issues are quickly moving up the agenda, with organizations looking to resolve these matters as efficiently as possible. The seemingly borderless business environment has enabled organizations to harness the power of cross-functional and dynamic consumer markets.
However, these developments have created bigger challenges for organizations, as they try to navigate a sophisticated, yet complex landscape of regulatory compliance while mapping the customer journey and enhancing the regtech customer experience.
Enter regtech, regulatory technology, an essential component of organizational operations, enabling companies to reliably resolve regulatory and compliance obligations. Regtech has helped companies revolutionize traditional processes while furthering their ability to reshape their internal practices.
With an ever-increasing number of regtech tools available, and with these innovative developments transforming how organizations meet regulatory obligations, could regtech help to reshape the future of customer experience for businesses?
Regtech and the Digital Customer
Regtech is steadily uprooting the traditional regulatory environment, acting as a key driver of efficiency for organizations and helping them better understand an ever-changing and complicated landscape.
The partnership with artificial intelligence (AI), machine learning (ML) and natural language processing (NLP) helps to underpin the development of regtech tools, removing barriers that previously created laborious challenges for organizations.
In the age of the digital customer, engagement is necessary at every level. Each touchpoint throughout the sales journey is an important consideration for organizations that are strongly looking to leverage various opportunities to enhance the customer experience while minimizing the need for laborious, repetitive activities.
In one industry perspectives report, experts have found that 68% of regtech buyers, such as C-level executives and industry leaders have stated that customer expectations are their key driver of interest in regtech solutions.
The age of regtech could make it possible for organizations to pinpoint security and compliance risks far ahead of time within the customer journey. Using the necessary processes, companies could further evaluate and resolve compliance risks that occur, using collaboration tools and making the supervisory process for employees more efficient.
Digitization and automation help to benefit the near-term focus of compliance teams within organizations. Through effective collaboration, teams can deal with regulatory issues within a desired period, while protecting both the company and customer information.
Instead of manually reviewing their regulatory and compliance obligations, regtech now allows them to:
- Create visual analytics.
- Utilize next-generation data architecture.
- Automate reporting mandates.
- Introduce efficient business process management.
- Harness AI, ML and NLP capabilities.
In terms of how companies have been partnering with both regtech tools and the digital customer, new opportunities allow them to incorporate a wide range of regulatory topics, which in the long-term provides them with the ability to monitor Know Your Customer (KYC) and anti-money laundering (AML) activities.
Related Article: 3 Strategies for Successful Customer Onboarding Compliance
How Regtech Is Reshaping the Customer Experience
The application of regtech is a nonhomogenous activity that coexists along with various organizational processes. From an outside view, regtech can oversee several dividing solutions, including compliance, identity management, control, transaction monitoring, risk management and reporting.
The overarching universe of regtech touches various facets of an organization. However, when connecting these applications along with the ability to restructure, rebuild and reshape the customer experience, regtech plays a key driver of influence.
Facilitates Accuracy
Improving customer experience through the use of regtech customer experience starts with understanding customer touchpoints and assessing these facets to ensure credible, qualitative and accurate information is provided.
By using a combination of regtech customer experience tools, organizations can better understand how customers are using these touchpoints, how they can further improve the accuracy of compliance integration and allow the customer access to a more structured pattern of information and solutions.
For example, a company might request customers to update their online information, either using their website or mobile application. Ensuring the necessary tools are available and customers have access to more structured touchpoints could help minimize complaints and concerns regarding privacy and efficiency.
Streamlines Information Processing
Collecting customer information is an important and highly valuable asset that allows businesses to make more accurate and data-driven decisions. However, in a time where customers are required to provide personal details for nearly everything, many often feel that sharing too much information can lead to increased cyber or digital risks.
Instead of relying on antiquated methods that would see companies requesting information that could potentially end up in the wrong hands, collaboration with regtech customer experience tools ensures that companies remain compliant with local jurisdictions, and safely extract and store customer information.
An important step throughout this is processing all of this information. Regtech customer experience applications allow companies to accurately extract the right sets of data, without having to require customers to provide too many personal details.
This enhanced experience ensures that customers are not presented with the laborious task of constantly providing information or having to repeat their actions once already completed. Regtech makes it easier for the customer to complete necessary compliance obligations and see companies tick all the regulatory boxes.
Issuing Predictions
Understanding how the regulatory landscape will change in the near future requires an unprecedented amount of human and capital resources. For larger companies, where dedicated teams work on extracting patterns to understand new developments, it can become cumbersome to do repetitive tasks or make calculated errors.
Instead, companies can now look toward technology as a possible solution for understanding future trends and how current developments will reshape the regulatory landscape.
Regtech tools leverage data extraction and data storage capabilities, enabling companies to tap into the necessary information that would provide them with more accurate solutions and mitigate potential pitfalls.
For the customer, this means that companies can accurately update their compliance requirements, alleviating any repetitive tasks that customers need to fulfill each year. More than this, organizations now better understand how to work with their clients more effectively and which processes will be more valuable in the coming years.
Slowly, but steadily, regtech customer experience tools remove antiquated methods and help to replace these with more advanced and superior solutions that see companies better understanding the regulatory landscape and how to modify their approach to help bolster the customer experience journey.
Secure Data Collection
As mentioned, security is one of the main and perhaps most important considerations when talking about using regtech tools within the consumer environment. Digital security protocols can vary across jurisdictions, which only creates further burdens on organizations and their compliance teams.
By incorporating regtech tools within their customer processing activities, companies can further improve the customer journey by allocating specific tasks based on where customers are located.
For instance, regtech applications would ensure that companies can initiate efficient information requests and follow local regulatory guidance. This is usually more common among financial institutions that often require customers to provide banking and other financial information digitally.
The partnership ensures that companies remain compliant, and customers can be assured that their information is gathered and stored using secure digital protocols that align with wider network requirements.
These tools act as another layer of security for customers, minimizing potential risks such as data breaches, data leaks or internal cyber threats. While the application may seem simple at its face value, further analysis could pinpoint certain pitfalls or help curb cyber risks that can cost companies countless dollars in remedying the situation.
Risk Mitigation
Minimizing potential risk goes hand-in-hand with cybersecurity essentials, enabling organizations to protect both their clients and themselves against any potential regulatory breaches.
For the customer, the benefit of regtech solutions ensures that core technologies used to collect and store data, such as cloud computing or Application Program Interface (APIs) are up to standard and are compliant with the broader judiciary framework.
On the other side of the coin, regtech products could help companies and their dedicated teams better understand the changing regulatory environment and provide them with real-time alerts in the event of any changes taking place or certain adjustments to legal compliance.
In both instances, regtech can be one of the many links within the value chain that helps to ensure organizations remain on top of regulatory issues and provide customers with the best possible and most efficient solution.
Consumer Customization
The partnership of technology and the customer experience enables companies to develop an experience that has been carefully tailored to each customer’s preferences and needs. With the help of consumer customization applications, companies can be assured that their regtech tools are catering to the specific needs of their target audience while enhancing their workflow capabilities.
Customizable regtech tools are designed with flexibility, allowing compliance teams to create tailor-made solutions that apply to their customers; and when executed within their market, can help benefit the larger operational procedures of the business.
Similarly, this could also mean that regtech tools can be adaptable in terms of the direction in which the business may be growing and how consumer trends are changing. For instance, changes to regulatory structures could help a company identify new challenges, without having to break their line of engagement with their clients.
This type of customization ensures that both the company and technology can grow simultaneously, adjusting to an evolving landscape within the market. Instead of becoming a restrictive barrier for customers and the business itself, tailored executions can help determine the unique operational needs of teams and how customers can benefit from improved operational workflow.
Related Article: AI, Privacy & the Law: Unpacking the US Legal Framework
Challenges of Regtech Customer Experience Solutions
Implementation of these tools is not without certain challenges, and for organizations looking for the right set of solutions to promote both regulatory compliance and an improved customer experience, overcoming these barriers could help them find innovative solutions within their scope of practice and consumer marketplace.
An Ever-Changing Regulatory Framework
Understanding the introduction of new rules can become a burdensome experience, often leaving some companies having to conduct further exploration of regtech applications to ensure they remain up to date with current and future changes.
Although there are regtech tools that support regulatory monitoring, this often requires companies to invest additional resources, services and products. This could place a cost burden on smaller merchants and hinder the scalability of the business.
Demanding Customer Onboarding Processes
In recent years, regulatory changes have meant that companies had to invest in finding reliable solutions for customer onboarding, including Know Your Customer and anti-money laundering regulations.
These additions have added only more complexities for companies looking to onboard customers, making it harder to simplify the onboarding process due to regulatory demand. Finding the right tools and conducting necessary testing would ensure that companies can implement the right solutions that provide automated processing for customers, without further complicating their onboarding.
Related Article: 4 Customer-Centric Strategies for Improving Data Privacy
Customer Transaction and Compliance Monitoring
Having an omnipresent identity within a competitive consumer marketplace could mean that investment in regtech tools can potentially further complicate scalability and future business endeavors.
Instead, companies will need to transform their customer transaction and compliance monitoring to draw up new ways of resolving existing issues, without creating more barriers within the customer journey or disrupting operational processes.
Fortunately, with regtech tools, businesses can effectively monitor customer transactions, pinpoint any potential risks and deliver more data-driven decisions to prevent fraud or regulatory challenges.
Finishing Up
Regulatory technology can help organizations resolve specific problems, enabling teams to conduct more thorough investigations, understand consumer transactions, and develop compliance and regulatory solutions that are tailored to customer demands.
By introducing the necessary tools, companies can ensure that they create more reliable customer relationship management protocols that minimize risk, and complexity and further increase the overall efficiency of the customer journey throughout the value chain.
Regtech helps to drive end-to-end regulatory solutions that are becoming increasingly important in the way organizations conduct business, engage with customers and create more simplified workflows for teams.
More than this, regtech customer experience applications can ensure that organizations collect, process, and manage customer information more accurately within the regulatory environment, allowing them to minimize compliance issues, analyze customer data efficiently and introduce new levels of automation to render a more effective long-term customer experience strategy.
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