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Why Banks must have an effective Compliance Management System?

Posted by: Sarah Hamilton | September 25, 2017

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Since banks are financial institutions, they are licensed to receive deposits and provide loans. They also provide important services like wealth management, currency exchange, and safe deposit boxes. Due to the high-risk nature of their operations, banks are regulated by the government and/or central banks. The regulatory bodies formulate certain compliance parameters to streamline the operations of these financial institutions.

Importance of Regulatory Compliance

Over 100,000 new security threats on daily basis have been noticed by the data centers of the modern world. Per surveys, it is found that more than 9,600 global executives had experienced one or more security incidents in a year. The increased number of hack attacks has left banks at a higher risk and it has become extremely important for them to operate within the confines of regulations imposed by regulatory bodies, to evade the threat of hackers. Also, banks need to safeguard themselves from hazards that arise because of errors committed due to negligence by employees.

Why Banks must have an effective Compliance Management System

Staying Compliant for Evading Risks

As we discussed before, regulatory bodies are tasked with creating and enforcing compliance. These bodies observe the system as a whole, understand trends, and devise compliance needs for the whole organization. When regulatory compliance is not maintained by organizations; the regulatory bodies punish the defaulters with heavy fines. Neglecting or flouting compliance needs are not only detrimental to the financial health of an organization; it can also destroy the reputation. For proper functioning of BFSI enterprises, it is vital for them to manage all compliance parameters laid down by the regulatory bodies.

Artificial Intelligence: The Key to Effective Compliance Management in Banks

In the vast ocean of compliance, rudimentary methods have become obsolete. The future is Artificial Intelligence (AI). AI powered software learns and enhances itself with regular use in a particular environment, which allows it to reach its full potential. At its zenith, AI always trumps other manually created compliance management methods, which makes it the perfect substitute to rudimentary methods for effective compliance management.

Compliance Management Software with Artificial Intelligence

AI powered Compliance Management Software is an advantage for BFSI industry as it is able to address all the compliance related issues. Predict360’s Compliance Management Software helps in making the whole process cost-effective by reducing the need for additional resources.

The AI powered Compliance Management module helps an organization in collecting, storing, and tracking on all compliance-related activities and regulatory reporting requirements. The customizable workflow engine of this software supports unique workflow processes for different types of activities and incidents. The easy-to-use data collection forms and automated alerts are quite simple and effective in the modern-day environment.

It has Key Performance Indicator (KPI) dashboards and reporting which are driven by:

  1. Priority
  2. Impact
  3. Urgency
  4. Type and category
  5. Parties involved
  6. Business unit
  7. Organizational area

The software also has a compliance calendar which offers total visibility to all compliance activities being performed. It is very useful for monitoring the status of an organization at any given time.

Benefits of AI powered Compliance Management Software

Adding an AI powered Compliance Management Software is a great way to ensure effective management of all compliance related needs. Some benefits of this software are listed below:

  1. Automated Compliance Management Software helps in maintaining version of policies and procedures while also tracking acknowledgements. It is a great way to ensure transparent and effective management of compliance.
  2. Automated software can analyze given data, provide recommendations to relevant levels and/or departments across the organization. This ensures everyone is in sync and has the latest information.
  3. Policy normalization which is built into software like Predict360, reduces the number of policies an employee must deal with. It does that by mapping emerging requirements to existing policies. This helps in aggregating similar policies and grouping them together, which makes for better compliance management.

Predict360’s Enterprise Risk and Compliance Management Software

Predict360’s Compliance Management Software removes the need for manual intervention as it uses its internal logic for making decisions. It has an internal logic that keeps on updating with regular use in a system. AI looks at all the patterns, analyzes data, and learns from the system in which it is employed.

For more information about Compliance Management Software and how it can be further enhanced as part of an integrated risk and compliance management suite, visit

About the company

360factors, Inc. (Austin, TX) helps companies improve business performance by reducing risk and ensuring compliance. Predict360, its flagship software product, vertically integrates regulations and requirements, policies and procedures management, risks and controls, audit management and inspections, and on-line training and qualifications, in a single cloud-based platform based on artificial intelligence.

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