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How Digital Solutions Protect Financial Institutions Against Reputational Risk




Reputation is one of the most valuable assets a financial institution has, which makes reputational risk management -- or the risk of loss of reputation -- an extremely important process for institutions.

Eighty-two percent of risk managers responding to a survey by The Conference Board indicated their companies are making a “substantial” effort to manage reputational risk. Unlike other risks that banks and credit unions manage, reputational risk is largely an intangible which can be difficult to effectively quantify.

Damage to an institution’s brand and standing within its community often results from data breaches and/or the perception of breaches or system outages. These failures often trigger negative publicity, erosion of public perception, reduced prospect and customer trust, diminished confidence with partners and investors, and even revenue loss.

Technology-driven risk mitigation optimizes both proactive and reactive counteractions to protect the institution and its stakeholders. For example, customer self-service expectations include 24/7 system availability, reliability, and security. By preventing outages with proven technology solutions, institutions reduce customer frustration, dissatisfaction, and attrition caused by the inability to complete fulfillment requests and transactions.

Reducing fraudulent activity protects the institution’s reputation as a safe environment in which to conduct business. Solutions like ARGO’s Connects provide consistent and transparent processes undergirding the financial institution’s responsibility to regulatory oversight and supervision. The requirements, restrictions, and guidelines that a financial institution may be subject to are systematically enforced, captured, and tracked within the solution, simplifying a financial institution examiner’s job to audit and administer regulatory compliance and reducing the reputational impact of any negative performance.

The damage caused to an institution’s brand and reputation as a result of failure to mitigate risk can be swift and devastating. Connects’ risk management safeguards the institution’s balance sheet and protects the valued trust with its community of stakeholders to ensure continued success.

For more information visit the “Reducing Risk in the Omni-channel Delivery Environment” interview brief.


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