Today, banks are dealing with an overwhelming morass of regulations – more than 20,000 new ones in 2015 alone. By the year 2020, there may be 300 million pages of banking regulations.
When I was in college, buying used textbooks had two benefits. It was a way to save a few dollars. Even better, if you could find one that was previously owned by a very good student, it may already have been accurately pre-highlighted, providing even stronger study assistance.
Wouldn’t it be nice if the specific regulations that applied to your business were highlighted? And maybe even sorted by country, by service, by deadline, by any number of variables you could select?
It’s not like banks aren’t throwing a lot of money at the problem. They’re spending about $100 billion a year on compliance efforts. And they’re paying more than $150 billion a year on fines and penalties when their efforts come up short because something was missed, misinterpreted or ignored.
The problem is that traditional technology is not well designed to understand and manage regulatory compliance. With regulatory guidance being completely unstructured (free form text in documents), it falls to people to painstakingly read and review countless documents in search of meaningful sections or passages. And as we know, human behavior, interpretation and concentration are variable.
Now, however, IBM is applying new technology to the field of regulatory compliance that can highlight critical information faster than any human. We call it cognitive compliance.