Seattle Bank's Proactive Approach in Adopting Regtech Solutions
01/08/2024
Regulatory compliance is rapidly becoming a significant area of technology investment for financial institutions of all sizes. According to Financial Brand, it is projected to expand to a market size of $87.17 billion by 2028, which is at least five times bigger than it was in 2020.
In Financial Brand's Why Bank RegTech Spending Will Increase in 2024, Seattle Bank shares how the bank looks for solutions that mitigate risk in real-time, which is especially critical in this digital age.
Seattle Bank, for example, has two growth initiatives that have spurred investment in regtech solutions: Partner banking — through which it partners with fintechs and non-financial companies to provide banking services — and CD Valet, an online marketplace that connects consumers to financial institutions to compare and open CDs.
“We are looking for solutions that mitigate risk, prioritize our team’s efforts and provide real-time information,” says Josh William, EVP and head of partnerships at Seattle Bank and CD Valet. “Real-time monitoring and reporting are critical, so we can flag activities or stop transactions early on. In a digital world, compliance needs to be based on what’s happening now, not what should have been prevented in the past. Regtech solutions get us closer to that goal.”
Seattle Bank also leans heavily on regtech to minimize compliance risk, but it’s tricky. Williams says his team has needed to be critical and highly selective of the regtech fintechs to partner with. For instance, Seattle Bank is investing in a marketing compliance regtech that will be efficient in monitoring, but also comply with data privacy concerns.
“This platform will help our compliance team keep up with growth and identify and remediate problems faster, before a single instance of noncompliance has the chance to become a more chronic issue,” he says. “We see it as a complimentary effort to our compliance team that will provide early warnings and help prioritize our partner review and education.”