Businesses do not operate in a vacuum. There are always laws and regulations that govern the operations of businesses in different countries.
The policies and procedures of business organisations therefore must be made to comply with these laws and regulations. Certain businesses (such as those in the Banking, Financial Services and Insurance industries) are more regulated than others.
Because of this, there are different regulatory compliance requirements for different industries. One such requirement for banks and other financial institutions is Know Your Customer (KYC).
It is the job of the compliance officer (or compliance team, as the case may be) to ensure that the business organisation of which they are a part, operates within legal, regulatory and ethical boundaries, thereby preventing compliance violations and potential penalties that accompany such violations.
What Is A Compliance Workflow?
Compliance workflow refers to the processes and procedures that make up the job of a compliance officer. A workflow consists of a series of processes/activities or a sequence of steps through which some work must pass to be completed. A compliance officer is usually saddled with the responsibility of assigning tasks and monitoring the timely completion of such tasks. The compliance workflow typically includes monitoring all business processes and procedures, managing flows of information by researching, recording and analysing data, risk management and assessments, corrective action planning, control evaluations and testing.
What Is Compliance Workflow Automation?
The use of technological tools and software to perform compliance procedures (as opposed to carrying out these procedures manually by compliance officers), is what compliance workflow automation is all about. Through the use of Artificial Intelligence, compliance software and technology can run compliance processes almost independently from start to finish, with minimal human input and supervision. For more on workflow automation, read this: Digital Customer Onboarding Process
Why You Should Automate Your Compliance Workflow
Here are several excellent reasons to automate your compliance workflow as a business:
1. It Saves A Lot Of Time And Energy
The processes involved in regulatory compliance are by their very nature highly time-consuming. The traditional method of compliance often leaves compliance officers worn out after spending a lot of hours performing manual processes. When you automate the compliance workflow, you will be able to channel your energy more profitably while having more time to attend to the high-priority aspects of your job, such as drafting relevant policies for different aspects of the business. This will undoubtedly boost your efficiency and effectiveness. When you automate your compliance workflow, it takes away the burden of manually going through tedious, monotonous and time-consuming compliance processes in the business organisation.
2. Eliminates The Use Of Paper Forms And Encourages Digital Transition
The use of numerous paper forms was one of the big challenges of the traditional compliance processes, where compliance officers have to pore over heaps of paper forms to carry out compliance functions. But when you automate your compliance workflow, it provides a digital customer onboarding software platform with little or no use of paper forms. This makes entry, storage and retrieval of data a lot easier for compliance officers. This also helps business organisations to transition from manual to digital processes.
3. It Brings An End To Manual, Repetitive Tasks
When you automate your compliance workflow, the often-dreaded repetitive tasks (such as data collection and data entry) that lead to monotony are easily taken care of. Compliance officers and other employees of the business no longer have to carry out these tasks from day to day.
4. Greatly Reduces The Risk Of Human Error And Boosts Compliance Data Accuracy
Automating your compliance workflow largely solves the problem of human errors such as missed notifications, non-centralised documentation and missed deadlines. Automation brings greater speed and better efficiency to compliance functions. One reason you should automate your compliance workflow is that it helps to streamline compliance processes, regardless of how complex they may be.
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5. It Provides A Robust Central Documentation System
Compliance functions rely heavily on documentation. For audit purposes, businesses need to maintain proper documentation to show that their internal controls are in tandem with their policies and procedures. When you automate your compliance workflow, all the documentation needed can be traced to a single base, which can be accessed with the right permission obtained. This makes the retrieval of data a lot easier for compliance functions. An automated compliance workflow enables a compliance officer to not only track tasks assigned to others but to have well-organised documentation that eliminates the human errors prevalent in manual compliance processes.
6. Easy Assignment And Tracking Of Tasks
One other reason you should automate your compliance workflow is that assigning and tracking tasks become a lot easier, such that when tasks are assigned, the software sends timely reminders to the people who have been assigned the tasks. As a compliance officer, you also get to see on the software what tasks have been completed, what tasks are outstanding and what tasks have exceeded their due dates or deadlines.
7. Allows For Prioritization Of Tasks.
Compliance requirements are often time-bound. Knowing what returns to file at what time will make a lot of difference in a compliance officer’s job. When you automate your compliance workflow, prioritisation is made quite easy as reminders can be set way ahead of a task or function.
8. It Makes For Easy Communication Between Internal And External Stakeholders
The automation of compliance workflow provides a central documentation platform. This makes it possible for stakeholders within and outside the organisation to share information, data and documents very easily. With just the right permission obtained, external stakeholders can access information within the business organisation that will answer whatever questions they may have.
9. Enables Easy Tagging To Delegate Tasks And Monitor Their Progress To Completion
When you automate your compliance workflow, it becomes easy for you to delegate tasks on the automated platform, and tag co-workers that have been assigned the tasks while monitoring their progress from commencement to completion, all in one place.
10. It Enables Easy Auditing
Businesses that must meet compliance requirements often require audits. A central documentation base as a result of automating compliance workflow will provide easy access to all compliance information that auditors will need in the course of conducting audit exercises.
Read Also - What are the Benefits of Compliance Automation Workflow?
Conclusion
The compliance landscape is a very fast-paced one, especially for highly regulated industries where new regulations are always being made. As such, performing compliance functions manually will greatly slow down the productivity of the compliance team and may lead to sanctions and penalties for compliance violations. This has made it highly expedient for businesses that desire to have smooth-running compliance processes to automate their compliance workflow.
See how 100+ leading companies use Youverify for KYC and AML screening of customers for compliance workflow automation for real-time risk detection. Request a demo today.