A study by the Centre for Research in Economics and Management concluded that higher liquidity measured by a credit risk ratio, is associated with low profitability for bigger players in the banking industry. However, it found that for smaller banks there is still a positive relationship between liquidity and profitability. Therefore, it becomes imperative for small- and medium-scale banks to cut down on liquidity risks by employing a reliable system. An efficient compliance management system not only helps in cutting down the number of liquidities risks but also reduces other financial and security risks.

Teams perform better with the use of an effective compliance management system.

Manual vs. Automated Compliance Management

A high-level comparison of traditional versus automated GRC management processes reveal why a compliance management system is so integral to staying ahead:

Aspect Manual Automated
Processing Speed Time-intensive Processes large data volumes quickly
Error Rate Prone to human oversight Consistent pattern recognition
Labor Requirements High dependency on skilled staff Frees teams from repetitive tasks for strategic work
Regulatory Updates Requires manual retraining for each regulatory change Algorithms update with evolving standards
Risk Detection Potentially delayed Real-time
Reporting & Audits Manual consolidation Automated audit trails

For an in-depth look into why manual compliance management results in problems, be sure to read our blog “Why Managing Compliance Manually is a Sisyphean Task“.

It is imperative for managers at these smaller banks to procure effective compliance management solutions to help them perform their duties and reduce risks[cite: 13]. [cite_start]We have put together five proven ways in which your organization can benefit from implementing a compliance management system.

1. Helps Maintain Business Process Workflow to Minimize Risk

Compliance management solutions come with a variety of features with amazing benefits, the most important of them being its ability to integrate a variety of business processes. It serves as a central repository where business critical information is saved and can be shared amongst stakeholders. By allowing selective and restricted access to employees, it ensures members of the organization receive only the intended information that they are authenticated for. Proper dissemination of information eliminates silos and makes for a well-connected work environmen. See our blog on “Holistic risk and compliance management” which will give you a better understanding.

2. Ensures Security of the System via Authentication

As mentioned in the previous point, in CMS, employees are authenticated before they gain access to the organization’s portal. This means vital information never ends up in the wrong hands. Authentication is an important security feature of the Compliance management solutions and one of its major benefits.

3. Helps Assess Risks in Multiple Areas

A compliance management system helps in assessing risks in all Governance Risk and Compliance (GRC) functional areas. The major areas covered by this system include:

  • Internal audits
  • Risk registers
  • Quality management
  • Finance and operations
  • Competency
  • Regulatory compliance and reputation

By assessing risks for all the fields and disciplines in GRC, it provides valuable inputs that can be used to eliminate liquidity and mitigate market risks.

4. Helps Map Requirements with Activities

By employing a CMS, every audit and corrective action can be mapped according to the requirements that drive the activity. As requirements change, the management process also changes accordingly. This mechanism helps drive the management process forward. This is visible across the organization. Notifications can be assigned on the Compliance Calendar for the responsible staff for activities completion.

5. Keeps Track of Regulatory Change

An efficient system helps organizations through the automating the monitoring of new and amended laws across multiple jurisdictions. This process will also automatically flag affected areas of the business. Once a regulatory change is identified, the system automatically assigns follow-up tasks and integrates updates into compliance policies, allowing organizations to respond swiftly.

Harness the Power of AI for Compliance Management

To achieve effective risk management, the power of AI can be harnessed in the form of the Predict360’s configurable compliance management solutions. Some of the main advantages of this software include:

Benefit Description
Unified Platform Consolidates risk management, compliance, policies, audits, training, and document management.
Regulatory Management Monitors regulatory updates across jurisdictions, assesses impact, and initiates automated workflows.
Real-Time Visibility Provides real-time compliance intelligence and predictive analytics through configurable dashboards and BI tool integration (Power BI, Tableau).
Cost Efficiency Decreases compliance costs through automation, reduced workload, and improved efficiency.
Rapid Deployment Cloud-based architecture enables integration within days.
Audit Support Streamlines audit preparation with automated evidence gathering, validation, and comprehensive audit trails.

This cutting-edge software can identify, quantify, monitor, and manage risks; and it can help a great deal in improving risk and compliance management processes employed in banks and financial institutions. By taking a proactive approach to compliance management with an effective system, your organization can increase productivity, save costs and keep up with regulatory changes in a way that is industry competitive.