APAC data regulations are pushing banks to upgrade their systems
REGULATORS in the Asia Pacific (APAC) region are actively developing new laws to help banks and financial institutions better protect their customers.
This is in line with efforts to emphasize data quality and granularity for better reporting while also increasing the standards of transaction data produced.
The regulations are understandably data-intensive and therefore, challenging, but also demand that systems in place help enhance management, collection, and processing of data
As a result, banks need to review their data management framework and measure the capabilities of their current technology systems to ensure that data quality requirements are met.
The new laws, however, seem to also be pushing banks to upgrade their solutions and information technology (IT) infrastructure for seamless, flexible, and scalable data management processes.
Banks will, therefore, need to be more digitally-enabled, adept, and equipped to accommodate the new reporting formats and data quality standards.
As a result, an upgrade to front-end and back-end systems is needed, which can help improve the transaction data generated based on three criteria: availability, quality, and completeness. In order words, banks need systems that produce more granular data.
While legacy systems may be able to produce granular data to some degree, they might not be able to meet regulations in the long run. Hence, in the cloud-native world, the best solution is to move to a flexible and more robust system that takes data quality into account right from the start.
Banks that are already leveraging smart infrastructure in the cloud environment can simply customize their data management tools to generate granular, quality data — gaining an edge over those holding back.
Data must provide insights to regulators
Since new regulations expect to produce insights at the government level, banks need strategic system upgrades and tailored frameworks to ensure flexible data management processes suitable for compliance with new laws.
However, investing in producing data that is right for statutory reports also provides an opportunity for banks to optimize technologies that drive agility throughout the entire system.
Smaller banks with limited resources can rely on vendors or service providers for short-term solutions to expand data collection procedures and deliver on granularity.
Although it seems like banks are pushed to address their digital inadequacies and invest in infrastructure upgrades just to meet the regulations, the operational benefits will place these banks ahead of their competition.
As a result, most of the larger banks in the APAC are building their own intelligent, cloud-first, flexible systems and solutions, to deliver on reporting requirements and support long-term needs.
According to experts, some of the smaller organizations are being motivated to focus on long-term goals when it comes to data infrastructures and systems as the shift is expected to help minimize data errors and adjustments, reduce reporting time, lower cost of ownership, and improve audit trailing.
Further, upgrades in the system also expand the capabilities of banks to efficiently deal with mass data and make additional improvements as they now have a more scalable system in hand.
In driving transformation efforts, regulators are helping banks embrace digital as well — and being resource crunched is forcing them to really think about the benefits of each project before leaping forward with solutions that make simply talk a big game but lack the strength to deliver returns or long-term success.