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Moving Compliance from ‘Friction Creator’ to ‘Customer Delighter’: A Perspective

In an earlier post, I had insisted that FinTech success requires several non-Fin and non-Tech skills to succeed; Compliance is one such vital talent. FinTech industry can find this skillset/ talent in abundance in the Financial Services industry. In this post, you’ll find refreshingly candid insights from a Compliance leader in a FinTech company on how Compliance talent can be a game changer and what it takes to transition from FinServ to FinTech. Much like our prior Subject Matter Expert interviewee (Marketing), he too has transitioned from FinServ to FinTech recently and is thriving.

Antonio Alvarez Lorenzo is the VP of Compliance at Yapstone, a San Francisco bay area headquartered Fintech company. Antonio was the ideal candidate for the interview since he has spent well over 20 years with Financial Services industry leaders like American Express, Visa and Western Union before moving recently to FinTech (Yapstone). Moreover, he has an amazing sense of humor which makes discussing any topic interesting.

You can learn more about Antonio and his role at Yapstone here. He mentioned that the opportunity to build something from the ground up was the main motivation for him to make the shift to FinTech.

What does ‘Compliance’ entail? (It’s more similar to ‘Operations’ than ‘Legal’)

Since I and Antonio had worked together at American Express’s Global Reengineering/ Six Sigma team, I too was curious about his move to Compliance. Tracing his own career path into Compliance (from Accounting and Process improvement), Antonio shared how Compliance is closer to business processes/ operations, though Compliance may be a part of Legal or Risk group.

 

A ‘Compliance customer delighter’ need not be an oxymoron

What comes to mind when you think about Compliance? Friction in the business process. A proverbial ‘sore thumb’ that slows down the process. You won’t be alone if you thought of something similar.

Moving Compliance from BPU (business prevention unit) to customer delighter and competitive advantage. The key, he explained, is to incorporate Compliance as a part of product development rather than including it as an afterthought.

This focus on reducing compliance related friction can become a competitive advantage for fintech companies.

What this also means is that FinServ and FinTech companies need to think beyond just current regulations, well into potential ways of protecting customer interests – regulation or no regulation – in their product design.

 

Risk-taking fuels growth but FinTech can not afford to skimp on Compliance

I brought up the trend we saw in mid/late 2016 where some emerging Fintech companies (e.g., Zenefits, Lending Club) were in hot water due to compliance related issues. Responding to my question on how they landed there, Antonio shared that while startup culture pushes the envelope on risk-taking, impact of ignoring compliance will catch up soon and hard as the startup grows.

 

Further, he felt that good RegTech solutions can help Compliance team/ personnel do their job better, more efficiently and improve customer experience: https://youtu.be/izc3nOijblM

Compliance professionals will face a slightly different environment in FinTech

 While sharing advice for Compliance professionals contemplating a move to FinTech, Antonio called out faster pace and expectation to deliver with limited resources as changes from the Financial Services environment. This was similar to the advice John Sommerfield shared with Marketing Professionals. Antonio’s tips on how to thrive in a FinTech (startup) environment can be found in the below segment.

 

If Antonio made ‘Fintech Compliance’ sound exciting and inspired you to seek out Fintech Compliance roles, here’s how you can find good FinTech Compliance roles:  https://youtu.be/RdA5eafQyLc

I do hope that companies building Financial solutions and products approach Compliance as a potential positive differentiator and not just as an industry regulatory requirement. The end consumer will benefit from this change in perspective.

You can find all the segments of this ‘FinTech Speak’ interview here: https://www.youtube.com/playlist?list=PLdzt6Lv1RR3rYYXxS5WZVlE93kODHJY9C

You can find previous ‘FinTech Speak’ videos at our Youtube channel.

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(Author is the Founder and CEO of S2E Consulting)