Beyond Compliance: The Top 5 Cross-Functional Benefits of FinCrime Software

One of the most significant challenges financial institutions (FIs) face today is balancing operational demands with regulatory compliance. Within banks, Electronic Money Institutions (EMIs) & Payment Service Providers (PSPs) spend up to 10% of their total operating costs on compliance measures. Thus, financial institutions need to justify the ROI of compliance software beyond just addressing regulatory requirements. 

The 5 Functional Benefits of FinCrime Software

In this blog, I will discuss five cross-functional benefits of implementing robust FinCrime prevention solutions and how the benefits can extend beyond compliance teams. Speaking about the core benefits I know to be true, I will focus on Lucinity's comprehensive suite of financial crime prevention solutions and how we can enhance productivity, drive valuable insights for different departments, reduce costs, and open up greater opportunities for FIs to focus on revenue generation. Even though you may not be working with FinCrime software on a day-to-day basis, you can still realize several benefits from the software that can impact your team. 

Enhanced Operational Efficiency for Product and Engineering Teams

Product and Engineering Teams constantly struggle with resource allocation as they weigh the cost-benefits of every project or solution they implement with a vendor. As they evaluate different projects, they must consider how each project benefits the business and which ones to prioritize. Each project implemented requires time and costs from engineers, professional services, and the company. 

One of the key challenges faced by Product Leaders is the build vs. buy challenge. An important consideration is that if the Product team decides to build a system, they must maintain it. That means that if the business launches a new product, enters a new market, or there's a shift in regulation, the Product team must make the necessary changes to ensure that the compliance software aligns with these changes. As geopolitical activities and regulatory requirements change rapidly, this can be a costly and time-consuming exercise. The last thing that Product teams want to do is to spend many hours on non-productive maintenance and development, taking away investment from their core business functions. 

Working with a vendor alleviates Product and Engineering of these burdens, as the maintenance is outsourced to a third-party, decoupling the FinCrime team's reliance on Product when they want to make changes. Furthermore, Lucinity's platform is built with a self-service first mindset, where the users can configure changes they need to make in the system themselves. 

For those considering building systems in-house, think about the engineering resources you will be allocating to build products for your in-house employees rather than building products that serve your customers and achieve your core business objectives. Building systems in-house spends time and talent on purely operational activities rather than revenue-generating activities. At Lucinity, we are the experts that can help your business excel in FinCrime prevention so that your experts can focus on what matters the most. 

Reducing Training and Recruitment Costs for HR Teams 

HR teams within FIs have a tough job, as they face high turnover rates and thus huge recruitment, onboarding, and training costs. Lucinity changes this, ensuring that analysts are happier and more satisfied in their day-to-day jobs. As our AI speeds up analysis and automates mundane tasks, analysts can focus their efforts on decision-making and investigating more meaningful cases. 

Our approach focuses on elevating less-experienced employees, offering them a unique opportunity for upskilling directly via AI. Luci, Lucinity's Generative AI copilot for FinCrime Prevention, transforms analysts' roles to be highly engaging. Luci's user-friendly interface, powered by Open AI's GPT-4 and GPT-3.5, ensures a rewarding experience from the first use, fostering a rapid learning curve for compliance teams. With Luci's assistance, analysts evolve into proficient case reviewers and investigators in no time, demonstrating how integrating advanced AI can scale up workforce capabilities efficiently.

The financial implications of integrating Luci into your operations are equally compelling. For a Tier 1 bank, Lucinity's solution could translate to annual savings of up to $36 million in training and recruitment costs by expediting the onboarding and advancement of less-experienced workers. Moreover, a potential increase in productivity, potentially saving $100 million yearly, is achievable by reducing financial crime investigation times dramatically.

Yet, the benefits of Lucinity's AI extend beyond financial metrics. Our AI dashboards' engaging and dynamic nature redefines job satisfaction for analysts, making their work environment more stimulating than traditional methods. This significant improvement in job motivation directly addresses one of the most pressing challenges in the banking sector: staff turnover. With the average turnover rate in compliance hovering between 20% and 30%, the ability to engage and retain employees presents a vital advantage.

The introduction of Luci both simplifies financial investigations and empowers analysts to fast-track their development, transforming their roles to be more investigative and engaging. This shift reduces the tendency for churn and transforms the perception of generative AI from being a potential job threat to a valuable tool for enriching employees' capabilities.

Operational and Financial Teams: Achieving Scalability and Cost Efficiency

Another core benefit of Lucinity is that it is adaptable and modular, suitable for companies looking to scale efficiently. First, it is essential to differentiate growth and scale. Growth means that a company is getting bigger, whereas scale means that a company has all the pieces of the puzzle at the right time. 

With Lucinity's modular platform, companies can ensure that they have the right pieces of the puzzle at the right time. FIs don’t need to buy Lucinity’s entire solution at once; they have the flexibility to purchase the modules that they need and upgrade over time. Lucinity also complements existing systems or can sit on top of existing software to augment the data from it. If an FI wants to keep their existing software, they can do so without needing to rip and replace and simply add Lucinity to maximize their process efficiency. 

As a company scales, Lucinity helps compliance teams manage growing transactional volume and adapt to changing regulatory requirements without the need to hire more people or perform offshore tasks. By better prioritizing and managing cases and maximizing investigation efficiency, teams can investigate more with less. 

The result is reduced compliance costs without sacrificing quality. In fact, with Luci and the use of Generative AI, compliance teams can improve quality and consistency. Lucinity also offers greater auditability and transparency, increasing confidence when addressing the regulators. 

Overall, FIs can amplify their efficiency and scale effectively without corresponding increases in operational costs. This efficiency, in turn, drives savings and aids in strategic business expansion, keeping headcounts controlled while operational capabilities soar.

Sales and Customer Teams: Transforming Compliance into Competitive Advantage

By transitioning compliance from a cost center to a revenue generator, it becomes far more than just a regulatory necessity. Lucinity can support Sales and Customer teams by providing them with a comprehensive overview of customers that can support risk underwriting as well as cross- and upselling opportunities. 

For example, imagine that Lucinity's customer intelligence can support banks with risk underwriting capabilities. This means higher-risk customers could face higher service charges, similar to the credit industry's approach to loans based on creditworthiness. Drawing on detailed behavior analysis, this system lets banks identify and adjust pricing for riskier clients engaging in multiple products. 

In another example, if a customer holds multiple products but doesn't hold a mortgage with the bank, the middle or front office can use that information to upsell more products to customers. 

Lucinity offers FIs with a comprehensive view, functioning as the powerhouse that enables your back-office operations to become more organized, optimized, and yield productive outcomes. As a result, we don't just help you maintain compliance, but we seek ways to use it as an advantage that can effectively increase revenue for your company. 

Empowering Senior Leadership with Strategic Insights

Lucinity equips Senior Leadership with swift, actionable intelligence, transforming compliance data into strategic insights. Our platform acts as an executive tool that informs decision-making processes. With Lucinity, leaders can access comprehensive compliance and operational performance data, enabling informed discussions in the most pivotal meetings.

By providing Senior Leadership with key insights, Lucinity positions itself as an indispensable part of strategic decision-making, ensuring that robust, precise data back every choice. Our reporting and analytics tools are tailored to support strategic, timely decisions that align with the organization's vision, ensuring leaders have the information needed at their fingertips to navigate the company's future confidently.

This capability transforms how leaders approach challenges and opportunities, promoting a data-driven culture that prioritizes efficiency and innovation at every level.

About Lucinity's Product 

As outlined above, Lucinity's comprehensive AI SaaS platform offers various cross-functional benefits. It consolidates all relevant data into one intuitive and analyzed platform, featuring a modern interface for enhanced user experience. Leveraging its powerful tools like case management solution and Luci (GenAI-powered copilot), Lucinity accelerates financial crime investigations for compliance teams, ensuring consistent, thorough, and fully auditable reviews. The platform is built to work seamlessly with home-grown or 3rd party solutions. It leverages a partner network for real-time fraud monitoring and sanctions screening. 

Furthermore, Lucinity's SaaS platform enables companies to leverage Lucinity alongside their existing systems without the need to rip and replace. As a result, Lucinity minimizes implementation and maintenance costs, offering cost-effective solutions for its clients. 

The key modules of Lucinity are outlined below: 

• Case Manager- Lucinity's Case Manager is an advanced solution that integrates seamlessly with your current technology, unifying disparate systems into a single source of truth. By unifying all signals, from third-party alerts to suspicious activities, it fosters more effective decision-making. This results in unlocking substantial annual savings, boosting operational ROI, automating compliance, and focusing team efforts where most needed, all while improving the overall user experience.
• Luci Copilot- Luci, Lucinity's Generative AI-powered copilot, transforms complex financial crime data into clear, actionable insights. Utilizing OpenAI's GPT-4, Luci accelerates learning for compliance teams, enhancing their case review and investigative skills. It simplifies complicated terms and processes, guides users confidently, and swiftly generates detailed, compliant reports. Developed using Lucinity's proprietary technology in conjunction with Microsoft Azure OpenAI, Luci adheres to a stringent ethical AI policy, ensuring the highest data security standards and responsible AI usage.
• Customer Intelligence (Profiles)- Lucinity's Customer Intelligence, or 'Profiles', provides a comprehensive 360-degree overview of clients' customer interactions. It seamlessly integrates vital information from various sources, including KYC (Know Your Customer) data, product-specific details, transactions, and external datasets. This powerful combination of data empowers users to effortlessly identify and analyze trends, anomalies, and patterns in customer transactions. 
• Regulatory Reporting- Lucinity's Regulatory Reporting system streamlines the case investigation process, offering a unified interface for organizing, reviewing, validating, and filing Suspicious Activity Reports (SARs). It features intelligent automation and direct filing capabilities, significantly reducing report submission time from four hours to just one hour. Key features include a clean SAR preview, automated XML generation, and case escalation workflows, all organized to support a cohesive investigative narrative. 
• Transaction Monitoring- We give customers control of Transaction Monitoring, allowing them to define rules that will cover their regulatory obligations. Supported by AI, Lucinity helps analysts prioritize the cases that require the most attention.