The Consumerization of Compliance Is Key. Here’s Why.
Guest editorial by Greg Bierl, Vice President and Counsel, Lending Strategic Alliances, Compliance Systems
Convenience and speed. These are two key metrics that consumers look for when completing any activity – grocery shopping, connecting to wireless networks, ordering an Uber, and now banking. Consumers have spoken and they want to manage their finances on their mobile devices as quickly and efficiently as they perform other their other daily personal activities.
As financial institutions navigate the new normal of delivering products and services digitally, they must do so with the consumer in mind. They should focus on user-experience choices that will help them evolve their digital presence in a way that supports how their members want to bank, how they want to communicate, and how their relationship with their credit union can make their financial life easier.
According to Gartner, Inc., consumerization refers to the impact that consumer-originated technologies can have on enterprises and how enterprises can take advantage of new technologies that originate in the consumer space rather than in the enterprise IT sector. Credit unions who consider the end-user’s needs first and invest in technology that meets consumer demand will reinforce trust and deepen those relationships.
Consumerization is not a strategy that credit unions can choose to adopt or ignore: it’s happening and cannot be stopped. Instead, credit unions should treat consumerization as an opportunity to support their communities and deliver the service their members already experience with companies like Amazon and Apple.
And consumerization should not stop for members after they select an online account or complete an online loan application. It should cover every aspect of digital banking, including compliance; however, this final step is often overlooked in the user journey. Compliance is part of the last mile, that final stretch of the consumer service experience where an organization’s investment in their mobile experience becomes more apparent to the member.
So what does consumerization mean to credit unions and compliance?
Mobility comes first. According to 2021 data published by Statistica, more than 43% of U.S. mobile banking users switched their primary financial institution because they were unhappy with their mobile banking offering. Compliance content needs to be designed for mobility—not to fit pages coming off the branch printer. If consumers are pinching, zooming, squinting, and reorienting their device to process and comprehend the legal engagement, the institution is failing the last mile test.
Get consumers to the finish line. Compliance language displayed on multiple pages and artificially separated into multiple PDFs can stall a consumer’s progress, creating user frustration and creating the risk that they will abandon the process. Financial institutions should have the same objective for minimizing clicks in compliance content as they do when designing the other steps in their digital banking workflow.
Content written for the consumer. Mobile apps should be designed to speak the language of the consumer with a direct, user-friendly interface. Compliance content has to be held to the same standard. Compliance partners should enable institutions to tailor content for consumer consumption and eliminate member confusion.
Supporting the financial journey. Compliance content provides an ideal means to extend and strengthen member connections. For instance, adverse action content can satisfy regulatory compliance with regard to the denial of credit while also promoting other loan products that might be an appropriate fit for the consumer’s credit profile. Guidance on how consumers can improve their credit scores could also be provided.
Consumerization is a positive trend that can help credit unions maintain a strong stance in their communities and deepen member relationships. The consumerization of compliance represents a unique opportunity for credit unions to maximize the last mile experience and support their member-engagement goals. Compliance standards are often set with the intent to protect consumers, and these trends in delivering a digital, mobile-enabled banking experience also support more consumer-focused, consumer-friendly compliance content.