Regulatory compliance holds back digital transformation say financial businesses
Regulatory compliance requirements have slowed digital transformation for 48 percent of financial organizations, according to a new study.
The research from banking security specialist OneSpan surveyed over 150 bank executives in the US, Mexico, UK, and France to assess how banks in different parts of the world are addressing compliance with changing regulations.
It shows the top compliance challenges for banks include reducing or preventing cyber-attacks (53 percent), safeguarding sensitive data (47 percent), and keeping pace with changes in consumer privacy laws and industry regulations (41 percent).
Almost half of banks are putting digital remote identity verification and biometrics in place in order to comply with industry regulations, while a further 41 percent are prioritizing emerging technologies like remote online notarization (RON).
The research also finds that 84 percent of financial institutions are preparing for central bank digital currencies. Bank leaders are generally optimistic about crypto regulations with 67 percent of financial services leaders agreeing that crypto regulations make banks' participation in the market more attractive. However, banks in the US are least likely to report having taken any steps to prepare for digital currencies.
"Catalyzed by the pandemic, the new digital banking age has left regulators with a nearly impossible task: to create an extensive and safe regulatory framework without stifling innovation," says OneSpan's interim president and CEO, Steven Worth. "However, our research found that half of global senior banking leaders have hit hurdles because of regulatory compliance. OneSpan’s Global Financial Regulations Report will arm banks and financial institutions with information they need to both be compliant and sustain their competitive position."
As well as the research, the second annual Global Financial Regulation Report outlines major developments in the regulatory landscape in 54 jurisdictions worldwide, with a country-by-country analysis of CBDCs, open banking, artificial intelligence, digital identity frameworks, e-signatures and remote online notarization, and data privacy.
You can get the full report from the OneSpan site.
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