Australian banks pilot regtech solutions to solve compliance problems

Citibank Australia, Westpac, and Commonwealth Bank of Australia are each using regtech to address laborious compliance tasks.
Written by Aimee Chanthadavong, Contributor

Between Citbank, Westpac, and Commonwealth Bank of Australia (CBA) there are plenty of compliance-related problems to solve, and each company is looking at regtech solutions to make it happen.

Citibank is piloting in Singapore machine learning to track the behaviour and conduct of the company's sales teams to look at "what good will look like and what bad will look like", Citibank Australia head of consumer bank independent compliance risk management director Larissa Shafir said. 

There are also plans to implement voice recognition across all overseas call centres to allow the bank to be more proactive than reactive to customers, Shafir said. 

"The technology will be able to detect tone and language, which from a compliance perspective is exciting, because we can move away from surveillance that's based on sample testing to surveillance that's 100% across the board and across every call. That's going to be conducted live, so you're not listening to a recording of a call, you can actually intervene during the course of the call," she said.

Locally, Citibank has partnered with Kaplan-owned regtech firm Red Marker to pilot technology that will remove duplication, which frequently arises when the compliance team is required to approve advertising campaigns developed by the marketing team. 

"We do have a lot of brands that Citi Group operates in Australia, so we have a lot of duplicative marketing material that comes across the desk of compliance staff and if we can reduce that, it's going to be a massive operational efficiency lift for us,"  Shafir said.

Speaking on a panel at the ASIC Monitoring Financial Promotions Symposium last week, Shafir said the solution will also help the compliance team track and monitor the compliance of existing campaigns. 

"Because we're advertising on multiple websites of our white label partners, we're hoping it will be a very useful monitoring and insurance tool to be able to show us where we have perhaps advertising that's out of date or something we want to change," she said.

Read also: How AI may help solve banks' customer relationship issues (TechRepublic)

Joining Shafir on the panel was Westpac wealth, Australia banking, and technology general counsel Nigel Bond, who revealed Westpac worked with Red Marker to introduce the bank's marketing and compliance teams to a real-time compliance tool that has been applied to 700 rules for its credit card advertisements.

"If you have an individual person reviewing a piece of material, by the time they've checked your ACN, you've got the right numbers, they've checked your ACL and made sure it's spelled out, and they check your AFSL … your poor person who is doing the checklist is starting to lose enthusiasm already. For us, the big thing with RedMarker is that it takes takes all of that out," Bond said.

By removing the "boring stuff", Bond said, it's a win-win for the company, its staff, and customers.

"If you run your analytics across and automate all the boring stuff and leave them with qualitative assessments then that person is coming to the role fresher," he said. 

"They have the checklist there, they have the tool telling them what they need to check, and that leads to an improvement in the work the person is doing and the outcome for the customer."

While Commonwealth Bank of Australia (CBA) is still in the early days of working out how it will leverage Red Marker's technologies, head of governance and assurance Jasper Poos said the bank has been re-imagining its risk framework by introducing chatbots, which are trained by staff. 

"It'll enable us to make rules -- what can you do, what can you not do -- more accessible for staff, which eventually is going to be a challenge because there are so many rules to comply with in the back and front office, so we want to make it as easy as possible," he said.

CBA is also experimenting with voice detection technologies. Poos explained during the panel session that the bank's data scientists have built an engine that can run sequences based on existing data sets to identify compliance trends and issues. 

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