Press Release

FINRA Warns Financial Institutions on Non-compliant Digital Contact with Customers

Financial customers vastly prefer omnichannel communications. By 2020, 68 percent of banking customers will be digital-only. The means that they will emphasize email, IMs, in-app communications, and yes, text messaging as opposed to in-person visits.

Digital-only channels offer a wealth of possibility when it comes to communicating with customers. It allows you to engage them where they feel most comfortable, be it Twitter, Facebook, Skype, or WhatsApp. What’s more, it allows you to harvest metrics that you wouldn’t necessarily be able to gather from an in-person meeting – and it lets you harvest those metrics automatically, and more accurately than you would otherwise.

Here’s the downside: at what point does convenient begin to get in the way of compliance? At what point does harvesting these easy customer metrics begin to erode customer privacy? Here’s how to balance convenience and security for your customers.

The Compliance Drawback of Omnichannel Sales and Marketing

One upside of the digital customer revolution, as we’ve said, is that it’s possible to meet customers where they feel most comfortable. Problems begin to arise when salespeople meet customers in spaces where they feel comfortable, but banks do not.

In other words, let’s say that a customer wishes to meet with a sales representative on WhatsApp. Unfortunately, the bank (or fintech, or broker-dealer, or VC firm) does not have an official WhatsApp presence. The enterprising salesperson, who is under pressure to make deals, decides to go ahead and use their personal WhatsApp presence to talk to their customer anyway.

Here’s where things get out of hand. Since the bank has no official WhatsApp presence, it has no way to monitor the salesperson’s conversation, or even to know that the conversation is taking place. This means that the salesperson can make all sorts of promises to the customer that the bank is not able to fulfil or pressure the customer to make risky trades and investment decisions.

Compliance-wise, this skirts the edge of disaster – and it’s beginning to happen more often. A recent report from FINRA shows that sales representatives often make suggestions to clients on unmonitored channels, and that banks and brokerage firms didn’t keep track of whether these recommendations were suitable. Under FINRA rule 3110, companies must implement supervisory systems to keep their representatives from breaking securities law – and the organization has the power to fine violators to the tune of millions of dollars.

Getting Omnichannel Communications Under Control

Since salespeople will most likely persist in using these growing digital marketing places , financial organizations need to immediately scale up their efforts to establish an official presence in these areas. This will force salespeople to contact customers via approved channels – and it will allow the companies to monitor their efforts. 

One signature benefit of omnichannel customer interactions is that it opens the pathway to analytics at scale. No matter how attentive they are, a human supervisor cannot possibly monitor all of the conversations taking place in a large contact center with hundreds or thousands of people. An artificial intelligence (AI) analytics platform, on the other hand, can absolutely handle to the challenge.

The effect of this technology is such that no matter how many salespeople you have – or where they happen to be located – you’ll have a solution in place that can monitor customer interactions, record conversations, and even flag problematic occurrences. 

This results in nothing less than automated compliance at scale.

Let’s say that your hypothetical salesperson is now chatting with a customer on a monitored chat channel. Maybe they get too aggressive or start going off the script. 

Luckily, your quality management and interaction recording tools support compliant communications by monitoring the chat and can detect flagged words or phrases that might raise a red flag with FINRA. In such cases, conversational AI and speech analytics – vital components for quality assurance – will alert the agent’s supervisor and provide them with a transcript of the engagement. The supervisor can immediately view or join the interaction, or even take it over, to verify the platform’s findings – extending the benefits of digital technology to improve the customer experience and prevent compliance infractions.

Empower Contact Centers with Automated Compliance Protection

When you work with top tier contact center technology providers, you should have access to a turnkey AI monitoring and quality management solution that can help you maintain compliance, avoid fines and challenges from regulators, and improve your customer service. 

Because customers are rapidly moving to digital-only channels, it is essential that you work with a solution partner that brings both the customer contact technology and the experience working with banks and financial services institutions to help you expand into digital-only spaces. 

Enterprises worldwide optimize customer engagement with Noble Systems’ omnichannel inbound/outbound contact technologies, workforce management, conversational analytics and self-service solutions. 

For businesses that need their contact centers to help customers achieve desired outcomes as efficiently and quickly as possible, Noble Systems is a trusted partner that combines 30 years’ industry expertise with the industry’s most comprehensive portfolio of omnichannel contact center, workforce engagement management and business intelligence solutions.

TechBullion PR

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