Compliance gamification? Sounds like an oxymoron, but we live in changing times and with RegTech beginning to make waves in retail financial services we see a need for diagnostic platforms that bridge the gap between the regulators rule book and it’s application in the marketplace.
Gamification is essentially the use of digital gaming features (think Pokemon GO) applied to other industries, RegTech uses digital to assess firm’s on-going compliance requirements, forged together gamification and RegTech can ensure firms audit processes are no longer like a visit to the dentist..
Model Office – MO has been designed as a business development diagnostic platform that benchmarks retail investment advice firms business development strength against independent market research conducted by research and development consultancy Engage Insight (Engage)
Engage’s 5-year research found there are 5 keys to building a professional service firm and thus incorporated a balanced scorecard approach to MO’s benchmark and performance dashboard where MO’s algorithm chooses tailored nudges and steers based on how each key scores to improve performance.
So where does the RegTech come in? Upon being invited to contribute to the FCA sandbox initiative in December 2015, Engage urged the regulator to develop a diagnostic where firms could assess their compliance development and strength. Yet as we live in a world of principles and risk-based regulation, the FCA cannot be seen to be prescriptive.
So this is when Engage designed and blended gamification aspects such as radar charts, performance dial indicators and dynamic behavioural steers with the FCA COBs suitability requirements, all relevant FCA discussion papers and MiFID2, TCF, KYC and BREXIT strategies to ensure firms can, for the first time, assess their business and regulatory development all in one digital platform in an engaging way.
Digital technology now provides the industry with both opportunity and challenge, MO offers both in providing guidance for firms’ professional development and a robust challenge to their compliance processes.