Every cloud has a silver lining. When COVID-19 hit, banks faced an enormous logistical challenge of shifting towards a secure, and efficient work from home environment. However, after the initial pain, they are now seeing the benefits as the pandemic helps accelerate the move towards digital.
Even before COVID-19 and all the chaos that came with it, digitisation represented the future. However, progress was slow. Even those organisations that accepted the need to evolve to keep up, were slow on the uptake. Old practices remained. Teams either failed to see the urgency or were suspicious of new technologies. COVID-19 meant that, like it or not, many had to make the leap and any concerns over security had to be resolved.
The effects have been rapid. Online banking has boomed as customers are shut out of branches. Even those who might have been reluctant before the pandemic found they had little option during it. Equally, teams have embraced remote working with video conferencing and online document editing becoming the norm.
In both cases those who had been reluctant adopters are realising the benefits. Employees who would previously have preferred to print and manage documents by hand are finding out how easy it is to quickly edit and send them online. Firms report relatively few home printers being used which not only reduces paper waste but without so many documents to potentially go missing, it improves security.
Across the board, people involved in digital transformation feel as if a dam has been broken. RegTech had already been growing… Investment doubled between 2017 and 2018 and projections foresaw rapid growth over the next five years. As with other areas of technology, progress was always stymied by a lack of urgency, fear of the new and legacy infrastructure.
Coronavirus has, in various ways, helped to dispel each of these. The most important is trust. In order to work effectively, RegTech firms have to convince banks to allow them to work with their most sensitive data. This carries significant procurement and compliance risk, but with increased use of technology and the sharing of data, it is helping banks to become more comfortable with the concept and to hone their due diligence.
At the same time, with financial and manpower issues becoming critical, the cost and resource savings from automated RegTech solutions also starts to become more appealing. As such, COVID-19 represents a moment of opportunity for the RegTech sector and many companies appear to be grasping this with both hands. Some have been offering open access throughout this pandemic, while others have been cooperating to improve the value they can offer their clients. Waymark Tech has been one of those providers offering free access to COVID-19 regulatory updates.
The result creates enormous opportunity for everyone. Banks have been forced to take the leap, while the specific nature of life during and after COVID-19 has increased the need for automation and technology. Going forward, technology will become even more important in maintaining the know-your-customer provisions, anti money laundering and fraud prevention.