Dealing with regulation is the day-to-day norm for the Financial Services. We know that.

The Financial Conduct Authority (FCA) and the Prudential Regulation Authority (PRA) work to build a competitive and innovation-friendly business environment.

FS firms are required to adhere to regulations for various reasons, including consumer and business security and protection of investments, as well as taking steps to ensure banks do not fail from poor investment and oversight. This all helps to protect the wider economy and reduce the chances of financial crashes as seen in 2007/8.

Upcoming regulatory initiatives can be seen in the FCA initiatives grid, and include regulations such as the LIBOR transition (2024) and Basel 3.1 (2025).

The PRA estimate £4.9m will be spent on implementing Basel 3.1 in the UK.

The challenge is knowing how to manage regulations.

Regulations are made to be your priority. These non-organic priorities distract from those organic business priorities that directly impact business operations.

Understanding how to respond and manage this shift in priorities needs to be considered as part of financial service firms’ strategies so there are no surprises when new regulations crop up. Strategic planning also means effort and resources can be scheduled to deliver both regulatory and standard business projects so nothing is left undone.

Deadlines are non-negotiable, and if they aren’t met can mean large fines. Knowing you can deliver your regulatory projects on time and to budget is important in strategic planning. Are you starting the project too late? Is the team equipped to successfully complete the project?

Responsiv has broad but in-depth experience delivering bespoke solutions to financial service firms. These include time-constrained regulatory projects inlcuding designing, building, deploying, and managing an Open Banking Gateway.

Responsiv has a track-record for delivering on-time and to budget, meaning we can mitigate some of the risks associated with regulatory compliance projects and the industry imposed deadlines.

Responsiv’s knowledge of industry leading technologies and products means we have skills in the chosen industry solutions. These skills have been utilised by financial services firms to upgrade legacy software whilst reducing the risks of system downtime to ensure software is compliant.

Finding the specific skills required to keep your business running is important but is proving to be a global challenge. Korn Ferry estimate that by 2030 we should expect a global human talent shortage of more than 85 million people. If left unchecked, in 2030 that talent shortage could result in about $8.5 trillion in unrealized annual revenues.

Based on its digital ambitions the EU alone wants 20mn technology specialists, which compares with the 9mn it had in 2021.

UK Finance state that the “financial services rely on highly-skilled talent to innovate, adapt and succeed. This reliance is only growing at a time when the sector is facing increased disruption from megatrends such as new technology, reliance on data, globalisation and changing workforce demographics. Firms are struggling to recruit the skills they need and are facing stiff competition for technological skills across the whole economy.”

Industries and organisations are searching for the answers to this global skills shortage, and one answer is to outsource, another to automate. 

UK Finance state that recruiting skills to mitigate the disruption of new technology is a struggle for firms. So how can they make the most of what they have, and mitigate the risks for the future?

Automating data heavy and repetitive tasks means existing skills can go a lot further; creating staff capacity for activities that need to be done but has been left waiting for new resources. Automation consolodates knowledge and ensures it is not lost when staff leave or move on.

Training and Education is a great opportunity to upskill your existing workforce. This does not mean you load them with double the responsibility, rather prepares them for new technologies and working practices in line with the changing landscapes.

The downside of this is the associated cost and time it takes to complete. If skills are needed ASAP then you cannot wait around for staff to be up to speed.

Outsourcing skills is perhaps the quickest way of mitigating the skills shortage. Finding a reputable partner with the desired skills means you do not have to find them as permanent in-house staff; removing the strain on budgets and recruitment.

These skills can vary from business analysts and project managers to IT and other specialist roles.

Outsourcing may also include procuring a managed service. This is mainly when looking at IT solutions. Managed Services mean your chosen vendor deploys, hosts, and manages the software and accompanying applications within the agreement (these are typically cloud-based).

Managed services take the responsibility out of house and ensures your software applications run as optimally as possible with patches and other support being included. Your users see the benefit without the worry of having the skills to fix bugs and make it run.

Responsiv offer managed services for our cloud platforms.

This means we deploy, host, manage and support your environments on behalf of your organisation. Your end users get the benefit of software applications and processes on cloud, without worrying about having to support the skills in house.

Responsiv Consulting provides business and technical skills to define, design, and build your solution. These skills can be utilised at any stage of your project as required to supplement your skills shortage.

Responsiv Assist is our remote technical support offering. Credit-based, it can be utilised only when needed for software support – updrades and patches, training sessions, troubleshooting, license and certification monitoring, document reviewing, etc.

Get in touch to find out how we can best help your organisation tackle the skills shortage.

Financial Services are at risk across multiple vectors including cybercrime, economic hardships, and regulatory initiatives.

The current regulatory landscape is turning to focus on the cyber security threat on the Financial Services, an industry risk that is broadened by digitisation and the use of third-parties. The nature of the financial services (data-heavy and financial assets) means they are a prime target for hackers.

The industry was the second highest target of cybercrime in the UK in 2022, with 305,785 new security breaches reported. In the last 12 months (May 2023), the finance and insurance industry has suffered a 50%+ increase in the total number of cyber incidents reported to the FCA.

Economic hardships including rising inflation rates and a stagnating economy leaves financial institutions at risk of failure should customers fail to maintain payments and keep the economy afloat. To navigate economic turbulence, companies should prepare well in advance, maintain a long-term orientation, and make decisions based on growth prospects and cost reduction.

Properly managing access to data and systems is an important first step to mitigating the risks associated with cybersecurity. Having oversight of users and their access will help mitigate the chances of staff accidently making data available to malicious parties.

Minimising the available attack surfaces for hackers means there is less opportunity to access smaller, ‘unguarded’ systems as an entry point for central, key systems. Having centralised access to systems means you only need to monitor a small surface, and can focus security on one place instead of thinly spreading defences.

Being able to detect breaches when they occur will reduce the time to react and remediate the attack. It is estimated that the time to identify a breach is nearly 3x longer than the time it takes to contain the issue (avg. 201days to identify, 70days to contain). This means that for ~201days, organisations are unaware of the attack vector, and in some cases, that they have even had a breach.

Reducing this time to identify will help organisations in reducing the cost of the breach, and allow them to address the issue sooner rather than later.

IBM Guardium is a database security solution with a wide range of capabilities to mitigate the risk of data breaches. And in the event there is a breach, can help to efficiently identify the vector.

Customisable based on your business’ data security policies, IBM Guardium allows you to manage user access, create regular reports and alerts, and apply your compliance policies to specific locations.

Responsiv has expert skills in IBM Guardium; allowing us to deploy and monitor the software to administer database security policies, configure the software to your requirements, perform vulnerability assessments and set up Guardium to monitor data and file activity, and more.

Responsiv has also designed, built, and deployed Open Banking Gateways for our customers. This solution included a ‘Cloud Bridge’ pattern to prevent cross-cloud attacks. Click here for more information on the cloud bridge security model.

Business Efficiency in the Financial Services can be improved in various ways. Consumers demand seamless online experience in their personal lives, but how does this uninterrupted experience translate to the corporate world?

Improving business efficiency results from reducing business cost and increasing business productivity. This is ‘easiest’ done by streamlining key processes.

Business efficiency can be improved by reducing process and workflow bottlenecks. For financial services firms, this includes managing repetative and data-heavy processes such as mortgage applications and approvals, internal and external onboarding, streamlining customer communications, and improving internal business integration to ensure data is correct and stored in one system of record.

A 2021 McKinsey study found that when automating the account switching process in a European bank, over 70% of applications were paper-based. Out of these, 30-40% contained errors. Automating these processes will decrease the time to process applications whilst reducing the error-rate that usually comes from human-centric processes. Business efficiency increases as errors and re-work is eliminated, providing a better service to customers and businesses.

Business Efficiency can be increased by improving inefficient processes; removing bottlenecks and unnecessary tasks. This will affect internal and external stakeholders such as clients and staff who regularly interact with these repetitive processes – including mortgage applications, data requests (change of address, name, contact information, or requesting reports).

Effectively connecting disparate systems and stakeholders will help reduce the need to manually share data; reducing errors that require remediating and data risks associated with sharing critical and sensitive information in unsecure ways.

Improving access to accurate, real-time data means decision times can decrease as stakeholders have all the information necessary for them to make the informed decision. This reduces the time other stakeholders have to wait for the backlog of decisions, seeing a domino effect of efficient decisions.

Automating processes will help in streamlining repetitive processes by either completing all tasks automatically, or utilising a hybrid of automatic and manual steps to complete a process.

Responsiv is an integration and automation specialist; our offerings and expertise centre around these technologies. With decades of combined experience working with financial services, our experts understand the chosen industry technologies, as well as best practices.

The Responsiv Cloud provides a set of full service cloud offerings that simplify your hosting and systems support. Our managed services takes the responsibility for managing you solution away from you, meaning we do all the maintenance work whilst you get the benefits of productive systems, applications, and processes. 

Responsiv Consulting provides advice for organisations that need to integrate and automate their data. We provide strategic guidance for how to move forward or to specific technical solutions that deliver your business needs.

We also help in defining and recording business requirements with our discovery wrokshops to engage key process stakeholders. This means we can mine staff knowledge of a process to ensure we are automating the right process and tasks to be as effective and efficient as possible.