By Nirvana Farhadi
Global Head Financial Services, RegTech Risk and Regulatory Compliance Affairs, Hitachi Vantara
A man who both spends and saves money is the happiest man because he has both enjoyments.
Since the 2008 banking crisis, the global financial services industry has been hit with a tsunami of regulation whose impact does not need explanation anymore. Being held ransom to large, shambolic, and messy systems that have grown far too large or risky to replace is costing firms billions in risk, operations, compliance, and audit (ROCA) costs alone.
Many of the large financial services institutions have been in business for a very long time,1 and their technological software was highly likely to have been built or bought well over 40 years ago. This dated technology, which was once shiny and new, is now a gnarly, mechanical beast, creaking and fragile, yet still – bafflingly – running critical business operations such as general ledgers, inventory management, and other back-office systems within organizations today.
The serviceability and functionality of these systems have not kept up with the times, and they are incapable of keeping pace with emerging regulatory requirements, let alone innovation. Many banking institutions run on infrastructure so old that they have had to encapsulate these systems with a patchwork of expensive ...