Bringing front-line lending efficiency to compliance

Bringing Front-Line Efficiency to ComplianceIn the last post about back office automation, I mentioned that while the back office functions do affect the whole lending organization in one way or another, there’s an even bigger issue at hand: compliance.

It’s a topic that every employee has had to be aware of at one time or another. In fact, most employees have had to take action based on it.

What makes compliance so ubiquitous in lending? It’s because compliance simply isn’t an option for today’s financial institutions anymore. It’s a way of being. And to add to that, it’s also constantly evolving. The reality now is that the ongoing internal efforts and the cost to remain compliant can be staggering.

That last point begs the question: What is the best way to contain the cost of maintaining compliance efforts as the financial sector faces tighter regulations?

From an ECM perspective, here’s a short list of issues that I’ve seen and how they can be solved:

  • Sensitive information being misplaced or put into the wrong hands.
    For most people, this is the first thing that comes to their minds about ECM and compliance: no more paper. While this is a clear benefit that’s easy to relate to, ECM’s more than just scan and retrieve these days.
  • Too many systems.
    One of the major issues with achieving compliance is maintaining consistent, accurate and up-to-date information. Oftentimes, organizations fall into the “one system, one job” syndrome – they buy piecemeal parts to handle individual processes without looking at the bigger goal. When this happens, not only are the systems scattered and hard to manage – the information is, too. While ECM isn’t the cure-all, it can serve as that “hub” of information, bringing together the documents, processes and other content it owns and integrating it with the data in other systems.
  • Slow responses to urgent compliance issues.
    Not every compliance issue is something that can be planned and handled two years in advance. Often enough, issues come up that need to be solved now. And that means that the systems managing the information need to be able to accommodate that change – now. This is where CIOs get passionate about needing flexible systems. They don’t want to make a tech support call. Rather, they want to be a few clicks away in their own configuration to make the changes happen. This capability is something that lending organizations need to consider when buying an ECM solution.
  • Not having a standard way to push out and track employee compliance.
    Have you ever received a document from HR in your inbox about reading a policy by a certain date? Wouldn’t it be easier to have a system to do all that – not to mention track the outcomes? Certain ECM solutions offer this capability, allowing the organization by extending policies and procedures across multiple business units, and then being able to track who’s in compliance and when the acknowledgments need to be renewed based on the policy.
  • No retention schedules.
    Most times, documents have to be kept for a certain amount of time, by law. But when a lending organization has a few million documents to keep track of, there’s no way that a manual retention schedule will work. ECM automates this process, making sure that a document is destroyed, or even reevaluated if there’s an extra layer of approval, at the right time to stay in compliance.

These are serious issues that lenders are dealing with today. The biggest problem, though, is that when they’re dealing with these issues, they’re not focusing on their more valuable day-to-day tasks. Therefore, ECM shouldn’t just be thought about as the way to ensure compliance with the most recent regulations. It’s also how lenders can focus on how to grow their business.

Sam Mazzola

Sam Mazzola

What do you get when you mix a certified Microsoft trainer, five years of experience at a large banking institution and an MBA in Information Systems? The answer – you... read more about: Sam Mazzola

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