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Voice data, compliance and the 'new normal'

Richard Stevenson, Red Box, CEO, London, 7 May 2021


Financial service workplaces are bound to shift to more remote working in the long run. This brings both problems and opportunities with regards to the management of staff and interactions with customers. Throughout it all, these workplaces must keep complying with regulations.

The world of work has changed at a speedier pace than one could have imagined before the Coronavirus hit the planet. It is essential for employers who manage staff in the financial sector to adapt to a hybrid or entirely remote model of working. Because the conditions in which they work are no longer under the control of the employer, a whole new set of rules is needed to ensure that they are representing their employers in the ‘right’ way. Access to secure and trusted technology, regardless of the employee's location, is crucial.

In October, the FCA warned banks [see www.fca.org.uk/coronavirus/information-firms] that they had to subject staff who worked remotely to the same standard of surveillance that they normally applied to staff who worked in offices. The regulator was fairly lenient on financial firms early on in the pandemic but it now expects them to have updated their policies and training to ensure that personal devices and networks are able to record interactions and do not compromise the data of customers, internal data or processes.

What the surveys say

It is more important than ever for firms to record these interactions with remote workers in order to monitor conduct risk and compliance and to prevent fraud, particularly as 57% of British IT decision makers (CIOs, heads of IT, IT directors, senior IT managers etc) from financial and other organisations with more than 1,000 employees believe that remote workers expose their organisations to the possibility of "data breaches," according to the Apricorn UK IT Security Survey Results for 2020. That figure has been on the rise in recent years, coming in at 44% in 2018 and 50% in 2019.

[Editor's note: In 2019 almost half of the respondents to the Apricorn survey admitted that their remote workers had already knowingly "put corporate data at risk of a breach" in the previous 12 months; this dropped slightly in 2020 to 44%. Apathy continues to be a major problem, with just over one-third of IT leaders saying in 2020 that their remote workers simply did not care about security – exactly the same percentage as in 2019 – which suggests that organisations are struggling to impose their security strategies on their people.]

The main incentive for firms to record these interactions is to comply with the European Union's second Markets in Financial Instruments Directive or MiFID II. However, it would be a good idea for them to do this even if they did not have any fear of regulators. The appearence of neobanks and a mass of financial technology firms in the UK in the last few years has made it imperative for all firms to adapt rapidly to stay ahead - not just of the competition but of "the curve."

According to a survey by Nuxeo in 2019 (updated a year later), more than two-thirds (67%) of British financial service workers believe that artificial intelligence (AI) has the potential to transform many financial firms, while 58% say that financial service firms that embrace AI are more attractive places to work. Despite this, British financial firms have been slow to use AI in most of their business functions.

The financial services industry, spurred on by an avalanche of legislation, is leading the charge with regards to technological know-how. However, nearly half (47%) of the financial firms in the survey said that they were unprepared for future legislation, despite having a host of technological tools to help them.

One way to prepare for legislative change is to use voice data. This is a crucial data set for any enterprise that wants to improve itself digitally. It is much more valuable than any other means of communication because it conveys context, sentiment, intent, emotion and actions, providing the compliance officer with real intelligence.

Uses for voices

Financial organisations are beginning to understand the usefulness of analysing voice conversations. It can help a firm know more about its customers and therefore to retain them more often - something that has become more important than ever since the markets crashed in 2008 and the marketplace become even more competitive and regulated. Firms can also use voice data to consider the experiences that employees are having and find out whether they are improving their processes and where the restrictions on this might be.

Firms are collecting more data than ever before. Access to that data and the use of automated processes to glean information from data sets is the key to improving every business.

Pitfalls for buyers

Although there is no shortage of effective AI and analysis software on the market, financial-sector IT buyers face two main problems. Firstly, there are issues surrounding the quality of the voice data with which the AI and analysis software has to work. Secondly, many an IT buyer is locked into one provider, which prevents it from picking and choosing the right AI and analysis software for its needs. Suppliers with an open application programming interface or API philosophy integrate seamlessly into automatic speech recognition (ASR) and AI vendors to make this data ready for analysis and easier to analyse.

There is no doubt that AI will play an ever-increasing part in shaping business results, with more "use cases" for AI than ever before. [Editor's note: In software and systems engineering, a "use case" is a list of actions or event steps typically defining the interactions between a role (known in the Unified Modelling Language as an actor) and a system to achieve a goal. The actor can be a human or other external system.] For financial firms that look beyond mere compliance with regulations, voice data has the potential to change the game.

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