The technology you need to comply with consumer duty


The final guidance of Consumer Duty comes with big requirements for evidence, says RegTech firm Aveni. What technology do firms need to comply with the regulation?

In a recent post by the company, Aveni detailed the five main kinds of technologies that company will need to leverage in order to meet the requirements of the regulator for Consumer Duty.

Aveni remarked, “As well as regulatory compliance, applying the right technology has the additional benefit of making business processes more efficient and driving team productivity which will be sorely needed given the projected costs of implementing the Duty.”

The first technology firms should leverage is product management technology. Aveni gives the example of Kore, which provides a digital product governance solution specifically for the financial services industry.

Aveni claims Kore helps companies create, manage and monitor financial products within an ever-changing regulatory environment – providing a single, centralised point of entry for process overviews, team connectivity and data-sourcing.

From a Consumer Duty standpoint, the technology allows companies to provide evidence that they’ve followed regulatory processes and fulfilled governance responsibilities throughout the entire product lifecycle, from idea generation to retirement.

Secondly, a machine line of defence is a necessary technology for Aveni and is one the company offers itself.

The firm said, “Accessing and monitoring all of your customer interactions is vital in gaining oversight and delivering good outcomes in line with the FCA’s regulations. Aveni’s AI platform, Aveni Detect, is designed as a machine line of defence, supporting the three lines of defence, boosting efficiency across business functions, enabling deeper data insights and risk oversight.”

Aveni said a machine line of defence can help businesses automate the QA process by capturing all their customer interactions and assessing and flagging the highest risk interactions to assessors for faster remedial action – something which helps drive ‘greater levels of efficiency’ and provides a better understanding of its customers.

The FCA’s guidance of The Fair Treatment of Vulnerable Customers is also embedded into the platform, which helps companies identify vulnerabilities, better understand consumer needs and skill-up agents to improve customer service experience.

The third key form of technology you need for Consumer Duty is digital customer service. Aveni remarked, “Good consumer outcomes are at the heart of Consumer Duty and technology that improves customer experience plays an important role in achieving those outcomes.”

The company gave the example of Glia, who’s platform combines the ‘human touch with technology to power conversations with customers, creating better experiences’. Aveni said this technology will help firms improve customer acquisition, modernise support and enhance your customer experience.

This feature is key to Consumer Duty, Aveni quips, as it helps to deliver a differentiated and more informed customer experience and help eliminate sludge practices.

Database technology is also key for Consumer Duty. Data on Demand – who uses a ID.VU data solution to enable firms to identify financially vulnerable customers – was cited by Aveni. The goal of the technology is to create positive outcomes and comply with regulatory requirements, thoroughly aligning with Consumer Duty objectives.

The final technology need cited is customer onboarding and protection. Aveni cites Trunarrative, a company that offers a technology that enables companies to control risk by mitigating against financial crime and keeping customers safe. It’s a single unified platform where you can onboard high customer volumes, verify them, monitor transactions and track risks.

This technology aids management and configures all financial life cycle journeys.  Trunarrative’s solution runs automated verification checks when onboarding new clients remotely. This automation check minimises friction, reduces exposure to fraud risk and provides evidential proof for compliance.

Aveni said, “The Consumer Duty calls for a high level of consumer protection in retail financial markets. It also supports more agile and assertive supervision, expecting firms to focus on preventing harm before it occurs. This type of technology can help mitigate against financial crime and work to keep customers safe.”

Read the full post here.

Earlier this year, Aveni raised £2.75m in a funding round headed by The TRICAPITAL Syndicate and Par Equity.

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