The Intermediary – August 2025 - Flipbook - Page 87
T E C H N O L O GY
Opinion
Easing the
compliance burden
T
he regulatory landscape
has grown increasingly
intricate recently.
That poses significant
challenges for mutuals.
Compliance with an
ever-expanding web of rules, from the
Financial Conduct Authority (FCA)
and other regulatory bodies, demands
substantial resources and expertise.
Finding people with the right skills is
not easy and the costs associated with
meeting these obligations continue to
climb, straining operational budgets.
Key regulations such as Consumer
Duty, the Mortgage Charter, and BIFD
are designed to protect consumers, but
their complexity – and the occasional
trade-off that this can present – create
hurdles for building societies striving
to deliver exceptional customer service
while adhering to requirements.
Consumer Duty, in particular,
has emerged as a focal point of
frustration. Introduced to ensure
firms prioritise customer outcomes,
it requires building societies to
demonstrate consistently fair
treatment of consumers. However,
overlapping rules from various
regulatory frameworks can make
this challenging. For example,
compliance with Consumer Duty
might necessitate tailored solutions
for individual borrowers, but other
regulations, such as stringent capital
requirements, can limit flexibility.
This creates a paradox where
well-intentioned rules inadvertently
complicate customer servicing,
potentially slowing down processes
and increasing the risk of suboptimal
outcomes. For smaller building
societies, these challenges are
amplified as they approach critical
regulatory thresholds, where capital
requirements become more stringent,
oen perceived as a barrier to growth.
Despite these complexities,
regulation does not have to stifle
progress. Technology, particularly
artificial intelligence (AI), offers
transformative solutions to streamline
compliance, reduce costs, and enhance
customer experiences. By leveraging
data-driven tools, building societies
can navigate the regulatory maze
more efficiently while maintaining
their commitment to memberfocused service.
A prime example of this is the
adoption of AI-powered platforms
like NICE CXone, which we have
integrated into our telephony
operations. This has unlocked a range
of features that deliver significant
value to our operations teams, while
addressing regulatory demands.
One standout capability is live auto
summary. At the conclusion of every
customer call, NICE CXone generates
a complete, wrien transcript. In the
past, agents would dedicate substantial
time, oen 30 minutes or more,
to manually document call details
during wrap-up. This process was
time-consuming and prone to human
error or subjective interpretation.
Agents can now focus on ensuring
customers receive the right outcomes
rather than being bogged down by
administrative tasks. The AI also
summarises key points and seamlessly
integrates them into the customer’s
journey within our system. This
creates a comprehensive, auditable
record of every interaction.
For building societies, this
could be a game-changer. A
guaranteed transcript of every
customer call provides a robust
audit trail, ensuring compliance
with regulatory requirements. The
factual, documented record removes
ambiguity, offering assurance
that information shared during
interactions is accurately captured and
easily accessible for audits.
Beyond imagination
The potential of AI extends far beyond
transcription. Emerging capabilities
could revolutionise the management
of compliance and customer care. One
MEL SPENCER
is growth director
at Target Group
exciting development on the
horizon is sentiment analysis and
the identification of vulnerable
customers. Soon, AI systems will be
sophisticated enough to detect specific
phrases that indicate a customer may
be in a vulnerable position. The AI can
alert the agent in real time, prompting
them to adjust their approach. For
instance, the system might suggest
discussing forbearance options,
flexible payment schedules, or other
tailored support mechanisms.
This proactive identification of
vulnerability aligns directly with the
principles of Consumer Duty and
‘treating customers fairly’.
By documenting that appropriate
actions were taken to support
vulnerable customers, building
societies can demonstrate due
diligence during regulatory audits.
While this advanced functionality
is not yet widely available, proof-ofconcept testing is already underway.
Building societies that adopt these
tools early will be well-positioned to
stay ahead of regulatory demands.
The broader implications of AI
adoption are profound. By automating
time-intensive tasks like call
documentation and enabling realtime insights into customer needs, AI
reduces operational costs and frees up
resources for strategic priorities.
Rather than viewing regulation as
a barrier, societies can use technology
to turn compliance into a competitive
advantage. As AI continues to
evolve, its ability to address complex
challenges will only grow.
Building societies can reduce
the compliance burden, enhance
customer outcomes, and position
themselves for sustainable growth in
an increasingly regulated world. ●
August 2025 | The Intermediary
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