The document discusses the compliance challenges faced by financial institutions in the mortgage industry and outlines how regulations impact both lenders and home buyers. It emphasizes the need for financial institutions to streamline operations and leverage technology to enhance customer experiences while staying compliant. Strategies include creating master customer profiles and utilizing digital asset management to effectively manage and deliver content across channels.

1. Presented to:
NetFinance
Solving Compliance Challenges Across Digital Channels

2. ABOUT R2I

3. ABOUT R2I

4. GOALS
Financial institutions are driven by a core set of business goals. Compliance
and regulatory laws can stand in the way of achieving those goals.
Compliance and Regulations
• SOX
• RESPA
• “Do not call”
• “Can Spam”
• GLB Act
• PCI-DSS
• Equal Credit Opportunity
• Home Mortgage Disclosure
Business Goals
• Acquire new clients
• Upsell existing clients
• Keep existing clients
• Nurture relationships
• Expand product offerings
• Reach new markets
• Increase operational
efficiencies
Situation Overview

5. GOALS
Homeowners need mortgages and originators are paid on commission to provide mortgages,
yet regulations and compliance present several challenges:
Challenges home buyers face:
• Compliance impacts to getting a mortgage
Challenges lenders face:
• Mortgage fines
• Settlements
• RESPA violations
Situation Overview

6. In early December 2013, 6 of
the leading financial institutions agreed
to pay $23.3 billion in mortgage
settlements.
Source: Forbes, December 11, 2013

7. Wall Street banks and foreign rivals paid
out more than $100 billion in U.S. legal
settlements since the financial crisis.
Source: Financial Times, March 25, 2014

8. GOALS
Compliance regulations are here to stay and will become more restrictive.
How do we address the opportunities created by these guidelines?
• How other industries handle managing customers, content, marketing and technology
• How financial institutions handle it
Why Can’t This Be Easy?

9. GOALS

10. GOALS
How Financial Institutions Address The Opportunity

11. GOALS
No single source of data
• Increased operational costs
• Missed opportunities to connect with potential clients
• Heavy overhead for new business initiatives
• No attributions or digital profile connected
to opportunities
Why Can’t This Be Easy?

12. GOALS

13. EXAMPLE SCENARIO
Scotts Company:
• Mortgage provider
• Has 3,000 national branches
• Has a website to provide reach
outside of his brick and mortar
branches
• Has a fully staffed call center
for potential customer inquiries
• Needs to reduce operational cost
• Wants to employ a national
marketing campaign to increase
revenues
Opportunities:
• Drive online applications –
cheaper and more efficient
then local branches
• Reduce calls into call
center by providing online
touch points
• Reach new markets by taking
advantage of social
campaigns to provide “word
of mouth” referrals to his bank
• Provide a personalized online
experience for various
customer segments
SCOTT, CEO
Compliance and Regulations have traditionally slowed these opportunities
Get Better, Faster, Stronger…

14. COMPLIANCE ISSUES
More online applications result in:
• Less operational costs than traditional phone/mail applications
• More revenue from greater reach
Compliance issues:
• Regulations vary from state to state—identify geographic limitations
• Challenged to verify applicant identity without identification
• Responsibility for fraud
• Managing rule and regulation updates and quickly updating traffic drivers
Driving Online Applications

15. COMPLIANCE ISSUES
Streamline the process:
• Create a single master profile for
each applicant
• Attach regulations to a master record
• E-identify applicants / users
• Push regulation changes to all
channels from a single repository
Driving Online Applications

16. COMPLIANCE ISSUES
Streamline the process:
• Add more self-service options reduces operational costs
• Digital communications reduces risk
Compliance issues:
• Accurately automating a process with hundreds of variables
• Adjusting to change with a documentation trail
• Managing rule and regulation updates and quickly updating traffic drivers
Don’t eliminate call centers:
• Reduce operational costs through personalization
• Access the master profile for every touch point
• Create online touch points to eliminate call center traffic
• Allow call center to serve as point of reassurance
Reduction in Call Center Costs

17. 47% of financial institutions state that
their call centers help increase market
penetration; 72% state they expected it
to do so
Source: Call Centers in Financial Services: Strategies, Technologies, and Operations, NYU / University of California - Berkeley

18. COMPLIANCE ISSUES
• Financial transactions are trust-based
• More word of mouth referrals drives more leads and in turn more revenue
Compliance issues:
• Breach of personal information
• Need content to spread socially but need control over content
• Fear of interpretation
Embrace technology
• Social networks, email, display advertising, thought leadership content
• Compliance can integrate with technology and content so long as risk is not introduced
• Leverage content repository with an editorial calendar to broaden outreach in
approved process
Reduction New Markets

19. COMPLIANCE ISSUES
• Personalizing products online reduces need for branch visits
• Better personalization improves conversion rates and drives revenue
Compliance issues:
• Delivering personalization within privacy law policies
• Creating customer segmentation borders on unfair lending practice laws
• Managing inappropriate segmentation
Embrace technology and analytics:
• Use analytics tied to customer profile
• Create online segmentation based on analytics
• Use single content repository to reach customer segments
Personalization

20. COMPLIANCE ISSUES
• Reacting quickly to constant changes in rules and regulations
• Identifying the audience without breaching privacy or unfair lending laws
• Recognizing that documentation means accountability
• Maintaining a personalized level of customer service without a direct personal interaction
Stop it. Your industry is behind. Be aware of concerns—
don’t let them hold you back.
What Are My Main Concerns?
Digital = Complicated
Compliance = Complicated
Digital + Compliance = High Individual Risk

21. Do it right.. And stay compliant

22. • Create a single repository for content
• Streamline delivery of content to all channels
• Update content with single action and cross-channel distribution
THE BIG IDEA
The Big Idea: Digital Asset Management

23. All of your customer’s data is publically available to you—use it.
THE BIG IDEA
The Big Idea: Master Customer Profile

24. Use a marketing program that can tie your customer data together to create
a personalized online experience.
THE BIG IDEA
The Big Idea: Master Customer Profile

25. Tie it together…

26. Delivering a truly custom experience requires in-depth knowledge of each potential
borrower’s online and offline behaviors. What does that mean?
What we know:
• Rachel is a first time visitor to the site
• Rachel spent 2.5 minutes on the site
and visited 3 pages
• Rachel is interested in purchasing her
first home
• Rachel was referred to the site via a
Google search
What we don’t know:
• Why did Rachel leave the site?
• Is Rachel ready to buy or just researching her options?
• What are her purchasing habits?
• What are Rachel’s interests?
• How much does Rachel know about the home buying process?
• Is Rachel financially qualified for home ownership?
• What other mortgage sites has Rachel visited?
• Is Rachel active on social media?
• Has she contacted any mortgage providers by phone?
• What types of mortgage related information is she researching?
• Is Rachel primarily a mobile or desktop user?
• What 3rd party resources does she engage with?
MANAGING CUSTOMER EXPERIENCES
Optimization: Creating Customized
Experiences for Borrowers
RACHEL JONES

27. Identify each potential borrower’s digital footprint and use data to create an
optimal experience across all channels.
This won’t break privacy laws
What we know:
• Rachel is a first time visitor to the site
• Rachel spent 2.5 minutes on the site and
visited 3 pages
• Rachel is interested in purchasing her first
home
• Rachel was referred to the site via a
Google search
• Rachel is an active user of Facebook and
YouTube
• Rachel has researched loan options with
Wells Fargo, Quicken Loans and Bank of
America
• Rachel is married to Adam and the couple
is expecting their first child
• Rachel is interested in purchasing a single
family home in Baltimore County within the
next six months
• Rachel primarily uses her mobile phone to
conduct online searches
• Rachel and Adam identify as having a
“good” credit rating
This might break privacy laws
What we don’t’ know:
• Has Rachel completed a mortgage
application with Wells Fargo, Quicken
Loans and Bank of America?
• Rachel’s household income?
MANAGING CUSTOMER EXPERIENCES
Optimization: Creating Customized
Experiences for Borrowers
RACHEL JONES

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first home?
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Value of pre-qualification for
first-time home buyers
Dear Rachel,
Congratulations on beginning your journey to first
time home ownership! We specialize in providing
loans. We’ve been in the industry a long time and
we’re here to help guide you through the process.
We have a variety of tools and resources
available to help you determine how much you
can afford, compare loan options and rates and
calculate your monthly payment.
Calculator Pre-qualify
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Rate table.
MANAGING CUSTOMER EXPERIENCES
Optimization: Creating Customized
Experiences for Customers
Take what we can and use and personalize for Rachel.
Rate & Loan Calculator

29. But what about compliance?

30. COMPLIANCE ISSUES
• Reacting quickly to constant changes in rules
and regulations
• Identifying the audience without breaching
privacy or unfair lending laws
• Recognizing that documentation means
accountability
• Maintaining a personalized level of customer
service without a direct personal interaction
• Digital + Compliance = High Individual Risk
• Deploy a Digital Asset Management System
• Use open and available data
• Use offline analytics in an online program
• Develop a master customer profile
• Digital + Compliance = High Individual Reward
What Are My Main Concerns And
How Do I Solve For Them?

31. Q&A
Nick Christy
SVP Enterprise Technology
R2integrated-Digital Marketing & Technology
[P] 410-369-3777 | [M] 410-459-2410
nchristy@r2integrated.com | www.r2integrated.com
Locations in: Baltimore • Seattle • Boston
Twitter: @NickChristy | Skype: NickChristy
http://www.linkedin.com/pub/nick-christy/3/ab4/759