If you’ve done any kind of banking at all, you know there are always many documents to sign, identification to provide, and information to hand over. 

But why is this? As tedious as it can feel to go through the process of opening a savings account or getting a mortgage loan, this is all due to compliance — and the good news is that it benefits you just as much as the bank.

What exactly is compliance? Bank compliance refers to the adherence of banks and financial institutions to laws, regulations, guidelines, and specifications relevant to their business.

Simply put, financial institutions must operate within certain government regulations and industry standards.

Compliance ensures that not only are you protected and treated fairly, but also maintains the overall stability of the financial system. 

So, while it may feel like a pain to sign one more document, following these rules does help to safeguard you in many ways. Let’s take a closer look at why compliance is so important for you as the customer.

What compliance does:

1. Protects your assets. Compliance with regulations like those enforced by the FDIC (Federal Deposit Insurance Corporation) guarantees that customer deposits are insured up to a certain amount. This protects your money in the event of a bank failure.
2. Prevents financial crimes and fraud. There are multiple regulations in place to reduce fraud. Some of these include anti-money laundering regulations and Know Your Customers regulations, which require banks to verify the identity of their customers.
3. Provides privacy and data security. Banks have robust cybersecurity measures in place to protect customer data from attacks or breaches, reducing the risk of identity theft and fraud. Compliance with regulations like GDPR (General Data Protection Regulation) and GLBA (Gramm-Leach-Bliley Act) also help to keep your personal and financial information protected.
4. Ensures fair lending practices. Consumer banking laws require banks to treat customers fairly and provide clear, accurate information about products, services and fees. This empowers you to make well-informed financial decisions. 
5. Promotes financial stability. Compliance with regulatory capital requirements and prudent lending practices ensures that banks have enough capital and liquidity to remain stable and protect customers’ investments.
6. Maintains ethical banking. So that banks are managed in the best interests of their customers and stakeholders, compliance regulations enforce ethical standards, codes of conduct, and good governance practices.

Our compliance department at INB has a big job: protecting the integrity of the financial system, supporting economic stability, and fostering a secure and reliable banking environment.

So, the next time we ask you to sign yet another document, you can have peace of mind remembering that a lot of work goes into making sure your data is private and your assets are protected!