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In May 2018, the White House administration signed a piece of bi-partisan legislation that rolled back banking regulations passed in response to the 2008 financial crisis, most notably relaxing some of the Dodd-Frank requirements. The legislation came with mixed reviews – some lawmakers agree it provides necessary relief, especially for smaller financial institutions, while critics contend that the deregulation measures leave the system vulnerable to risk and financial instability. As the fiscal landscape continues to evolve, banks should continue to focus on compliance, risk mitigation and the possibility of an increase in regulatory scrutiny.

More importantly, banks should be just as concerned about the ever-increasing expectations of customers as they are about the regulatory environment. Recent bank fraud scandals and numerous data breaches have led customers to demand transparency and a better customer experience that puts them first. Customers are looking for bank representatives to be knowledgeable, put their interests as a consumer first, and be easy to contact.  With an increasing array of ways that customers reach out to banks, the task of delivering on those demands while maintaining control over risk and compliance assessment becomes more complicated. The Northridge Group’s 2018 State of Customer Service Experience study found that less than 50% of consumers find any channel (phone, online chat, web, social media, texting, mobile app, etc.) easy to use. This leaves businesses, including banks, vulnerable to customer churn and negative financial impacts.

The stakes are high, but banks that figure out how to best drive improvements in customer satisfaction levels while effectively managing their compliance performance and controlling their risks will rise to the top of the market. What is the solution? What can banks do to stay ahead of regulators and rise to deliver on customers’ needs and expectations?

Compliance departments within banks must redefine their role in the risk management equation from that of advisor to that of proactive monitor. One key to achieving this transition is to establish a Customer Contact Compliance Quality Monitoring program that provides feedback on performance against regulations and risks but also listens broadly for business opportunities and unforeseen risks. This allows compliance teams to actively work with training and learning teams to identify areas where there are opportunities to increase understanding before employees interact with customers. It also allows compliance teams to work with operations teams to mitigate risks before they occur.

Quality monitoring gives banks the ability to create a controlled testing environment to measure their current performance status and can provide representatives with immediate feedback for improvement. It also provides compliance and risk management teams with additional insights and data that can be used for risk analytics and reporting.

The Northridge Group was recently engaged to develop Quality Monitoring assessments for a Fortune 500 financial institution to mitigate the compliance risks associated with its customer interactions and a Financial Services firm that sought to decrease its compliance-based violations.

Read our case studies to learn more about how Quality Monitoring has helped companies identify risks and proactively manage them.