The frontline staff at financial institutions are often referred to as “the face” of the organization. They interact most with clients and are largely responsible for fostering positive relationships with your customers. But as a compliance professional, you’re well aware of the impact frontline staff can have on your institution’s ability to pass regulatory muster.
Your institution/compliance department has likely already begun taking steps to prepare for the new Small Business Data Collection requirements of Section 1071 – but has your frontline undertaken the same preparation?
Prepare Your Frontline For Section 1071 with these 8 Steps:
- Ramping Up Training & Awareness
First and foremost, you need to ensure that frontline workers are aware of Section 1071 and its implications for your institution. You can start by providing comprehensive training on the requirements, data collection processes, and any changes to existing lending procedures.We’re glad to be able to help with this and have a session coming up designed to help frontline workers get up-to-speed on this large and complicated regulation.
- Getting Familiar with New Data Collection Fields & Forms
Educate your frontline staff on the specific data points your FI needs to collect to comply with Section 1071 and provide them with the necessary tools or documents to gather that info as accurately and efficiently as possible.Alongside this effort, you’ll likely need to implement clear guidelines for data entry processes to ensure consistency across staff. It may be helpful to create and provide templates or standardized formats to facilitate proper data collection and minimize errors.
- Capturing Demographic Info
Instruct frontline workers on the importance of gathering accurate demographic information from small business loan applicants. Train them on the sensitivity and privacy considerations surrounding the collection of this data, emphasizing the need for respectful and compliant practices.
- Emphasizing Privacy & Security Protocols
Without proper management, the collection and recording the data required by Section 1071 could lead to some tangled privacy or security issues. Impress upon your frontline staff the importance of protecting the privacy and security of customer data. Train frontline workers on data handling practices, including the secure storage and transmission of collected information.
- Improving Documentation & Recordkeeping
Maintaining throughout and accurate records of loan applications, approvals, and disbursements is critical. Be sure to provide adequate guidance to your frontline staff on the proper retention and organization of these records.
- Establishing Communication & Escalation Protocols
Outline a process for frontline staff to report any issues or concerns that arise from the collection of new data fields under Section 1071. Identify the person or people they should report noncompliance to or contact for guidance.
- Staying Informed & Updated
Urge your frontline workers to stay up to date with changes or updates to Section 1071 requirements. Share relevant communications, updates, and training materials early and often.
- Planning for Improvement
Try to foster a culture of continuous learning and improvement. Encourage frontline workers to provide feedback on data collection processes, identify potential challenges, and share insights to enhance compliance efforts.
Complying with Section 1071 will be an all-hands-on-deck effort, and with other major regulatory updates on the horizon (cough, CRA, cough), it’s critical that your frontline is ready to do their part. With the right support, training, and guidance you and your frontline will get through this regulatory burden successfully.