In Retail Banking, Compliance is Not the Enemy

A strong partnership between marketing and compliance can meet ever changing government regulations while improving the overall customer experience.

There is a consistent theme that marketing departments or advertising agencies consider compliance as an enemy or “anti-sales department.” A friend of mine who works for an advertisement agency recently shared the idea that compliance is the devil.

She felt as though there are too many rules or requirements that prevent them from being truly creative, provide great marketing concepts or sell services overall. A great comparison would be the concept that marketing is the New England Patriots and compliance is Roger Goodell (The NFL Commissioner) – constantly setting up roadblocks to prevent the Patriots from succeeding. I am sure plenty of other individuals and companies in the marketing and advertising space felt the same way.

The concept of banking is changing rapidly and becoming more innovative. Marketing and advertising is not just flyers or billboards anymore. Financial institutions have the capability of advertising not only in their own banking apps but also in third party apps and other strategic digital sources.

The concept of compliance is not intended to be the enemy, or prevent marketing materials and advertising from being published. Compliance wants the business to strive and grow just as much as any area within the financial institution.

Compliance simply wants to ensure that the established rules and regulations are followed. These requirements were put in place to provide consumers and businesses the best opportunity to clearly understand not only what product or service the bank is offering, but what they are ultimately signing themselves up for.

Customer experience is one of the biggest factors that can keep a financial institution alive and thriving… or drive it out of business. It should be the goal of both marketing and compliance enhance the experience with customer communications.

Federal and state regulators are examining all consumer communication to ensure that institutions are not deceptive or abusive toward consumers. Their objective is to set the foundation clear and consistent communication to ensure that the consumer can ultimately come to the conclusion as to who to bank with, as well as what product or service are right for their current needs.

The penalty for non-compliance to these guidelines is severe. Regulators are fining institutions millions of dollars just for communication they deem to be deceptive.

The best way to ensure that financial institutions are in alignment with changing regulations is to have marketing and compliance departments work side-by-side from concept inception to distribution. Marketing needs to work with the compliance team to ensure that marketing and advertisements are clear, concise and true. Marketing also needs to understand that marketing materials and advertisements should be created with the consumer as the primary focus.

Most of the time, marketing departments and advertising agencies forget that they are also consumers when they are not working. The question to think of when creating a marketing and advertising piece would be “If I was the consumer, is this piece clear enough that I will understand what I am receiving and does it disclose all the elements of the products or service?”

Compliance needs to ensure that communications meet regulatory requirements that are currently set in place. Compliance also needs to understand the current state of the industry overall, because although there may be rules and regulations in writing, there is also gray areas that are best to interpret by understanding what is currently being being done in the industry.

This helps provide flexibility to ensure that marketing and compliance can meet each other half way, allowing for a blend of the creativity of marketing and the standards from compliance.The key is to develop a working partnership.

Marketing communication should never be distributed or used without the approval of compliance, including any changes that may be made after the initial approval has been provided. Compliance should always be kept in the loop. This ensures that no matter how fast the banking industry is evolving, consumers can always feel that what is being disclosed to them is always accurate, which will provide them with the best customer experience possible.

Transparency and clear communication is part of the overall consumer experience that is being evaluated during the consumer’s buying process and along the entire customer journey. Ultimately, communication developed through a strong marketing/compliance partnership will results in more sales.

In is important for compliance to work hand in hand with marketing and communication departments to provide the customer with best experience possible. In the end, while marketing and communication departments help financial institutions generate new customers and sales, compliance helps ensure that that the organization is able to keep the revenue.

The marriage of compliance and marketing needs to be strong to the point where one cannot operate without the other from marketing perspective. There will always be disagreements between the two areas, but the way to keep the marriage going is to compromise and bring all issues to the table.

You never want your organization to receive negative media because of deceptive practices any more than you want sales communication to be covered with disclaimers. It is incumbent on both marketing and compliance to work together to build a partnership as opposed to adversarial relationship.

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