I recommend that every compliance professional should ask their founders or executive team the following questions before they decide how to allocate their compliance resources and budget 2021.

The FinTech industry is struggling with scaling and profitability, customer churn due to inefficient onboarding design, long approval cycles waiting for regulatory permissions, and ever-increasing costs of maintaining inactive or low-transacting accounts.

You can make a much bigger compliance impact by asking for and getting clarity around the following business metrics (without trying to link it to any compliance issues – just listen – and by the end of this article you will understand why).

So, ask your business the following questions:

• How does your business measure success and growth – is it the number of new customers, volume processes, fees collected, new account activation rates? And how does 2020 performance look like? 
• If performance was good or bad – what were the drivers? Is it a good season? Bad economic cycle? Just one good or one bad strategic partner failure? 
• If the reason for potential poor performance is in the organization (e.g. not enough resources, not enough people…) are there plans to overcome it? 
• If the reason for poor performance is wrong assumptions or past decisions (e.g. customers did not like the product, non-competitive prices, no market for a certain service, the partnership did not work out) – what will be done differently? 
• If you had a great year in 2020, what will the company continue doing more of? Where are you allocating resources to?
• Is the company profitable? Which services or products are profitable? What is the cost of compliance and if you plan to have more customers, is the cost of compliance per each new customer getting lower or higher, based on the current projections and existing contracts and existing pricing and fees structure?

Now you hopefully see where I’m leading you: the success of compliance or its impact cannot be measured by how many policies you have or how many reports you produced or how many clean audits you completed.

The success of compliance is measured by how it serves and supports the company’s strategic objectives and if compliance does not support the company’s strategy, everyone is eventually going to fail, get fired, or run out of money.

2021 is not the year to say “financial metrics or growth rates or cost structure is not my compliance problem”. Even if (or when) bitcoin reaches the 100,000 USD milestone, it’s clear that the financial industry will face a lack of consumer confidence, plenty of uncertainties, contradictory and erratic governmental decisions and conflicting economic incentives, and potentially multiple systemic failures of no-longer-too-big-to-fail organizations and corporations.

FinTech Compliance must stay relevant more than ever. Most founders I work with are currently brainstorming up to 10 different product launch scenarios for 2021 and setting up various beta-launches, experiments, and trial projects to see what may work. There is no way any of us can be sure which of these projects will grow, but it’s important to be able to test the initial customer reaction, questions that come up from regulators, and partner buy-in readiness.

I seriously suspect that 2021 will be a year when iterative, incremental steps, trial-and-error approach will serve us well. But it also means that traditional compliance planning is likely going to be ineffective.

Think about it – if you want to take two months to do proper risk assessments for 10 potential projects and present them for board approvals on a 150-page presentation deck, and you know that most likely 8 of these initiatives are not going to work anyway, but you don’t know which ones… and you are already on a tight budget… You need to think differently about who does what in compliance and how do you get by with the resources you have available.

Which is why I have designed and put together a  workshop for FinTech founders, CEOs, MLROs, Heads of Compliance, CCOs, and other FinTech professionals who are currently re-thinking their 2021 budget plans to prepare for more uncertainties and debating how to balance between conflicting demands of various teams or suffering from organizational conflicts related to compliance responsibilities and division of labor.

AGENDA:

When: January 19th and January 20th, 2021 at 12.00 pm CET (about 1 hour each day)

Day 1: Hiring Compliance Resources – Who to Hire and When 

• Pros and Cons of using external consultants and BIG 4 for projects at various maturity stages
• When to hire your first compliance employee
• The difference between compliance and legal
• Hiring interns and part-time freelancers for compliance-related activities
• What to do during your first 30 days in any new compliance role – your compliance onboarding plan
• How much compliance should cost

Day 2: Evaluating Compliance Deliverables and Managing Organizational Conflicts

What compliance should deliver and be responsible for as a part of the following activities:

• FinTech Licensing
• Relationships with regulators and auditors
• Opening bank accounts and closing partnerships
• Product Developments and testing
• Customer Support interactions and managing conflicts, disputes, and complaints with or between customers

Typical organizational conflicts and how to deal with them:

• Compliance vs Product and Engineering
• Scrutinizing and Approving Customers or Compliance vs Customer Support and User Experience
• Compliance vs Marketing
• Compliance vs Business Development and Sales

So, if you’d like to learn more about how to build and manage a lean and efficient compliance team, avoid the most common organizational slowdowns and act with clarity where it comes to hiring and managing compliance resources, you are welcome to join this FinTech Compliance workshop on January 19-20th, 2021.