Banking trends have experienced dramatic changes with evolving technology. There has been a significant shift from conventional in-branch banking to online banking. Customers prefer to make their financial transactions within the comforts of their homes. Although banks have provided this convenience to customers, it has had to make significant changes in their operations.
With a rise in trends of online banking, there are associated risks. For example, there is a looming threat of cybercrime, data hacking, information leakage, and other cyber attacks. The legal system imposes heavy regulations on the finance industry to combat such occurrences. One of these regulations makes it compulsory for banks to archive inactive data.
File archiving refers to storing static data in different storage for long-term retention. However, this data can be accessed whenever necessary. Therefore, file archiving is essential apart from being part of bank regulations. This article highlights the importance of file archiving for the banking sector and how it brings value and convenience to the system.
1. Compliance with Regulations
The banking sector deals directly with finances. Therefore, all transactions, information, and data are related directly and indirectly to money. Now that majority of transactions are occurring online, this makes the info prone to cyber-attacks. Cybercrimes, data hacking, and unauthorized access are constant threats to vulnerable data.
Therefore, heavy regulations are imposed on the banking sector to prevent such incidents and allow banks to handle them well. FINRA 10-06, FINRA 11-39, and NASD 3010/3110 are just a few examples of the regulations and acts that banks must comply with.
Therefore, the prime importance of file archiving is ensuring compliance with rules set by the authorities. Failure to do so can result in heavy fines If you don’t, you risk paying hefty fines and penalties. And penalties. File archiving is a cost-effective storage solution that meets all legal requirements.
2. Data Management and Protection
File archiving software stores the data in a remote, safe location with protected access. This data can be accessed as per need only by the bank officials.
The sophisticated file archiving software offers complete organization to the data. Not only is static data stored, but it is also done with meticulous care to prevent duplication. Files are organized systematically as per the settings preferred by the banks.
Even better, the software automates the archiving system to reduce manual labor. Selected files automatically upload to the archive folders and are safely stored in the long term. Moreover, these files can be easily searched and accessed whenever needed.
Not only this, data archiving guarantees data protection against any cyber attack. Data is most vulnerable during transfer. All information is transferred via encrypted channels to prevent an attack during this stage. Stored data is safe in remote or on-premise storage, which is protected using advanced technology by the software.
Such convenience is a much-needed service for an online system with considerable volumes of data. The security of safe data free from leakage or hacking is what banks and other financial industries strive to achieve.
3. Monitoring Communication
The file archiving process allows banks to store information other than transactions. This includes communication between customers and support staff. Although it may seem unimportant on the surface, keeping such information has immense importance.
Insider trading is the illicit practice of selling confidential information or material of the bank. Saving customer communications ensures there have been no such incidents as they can harm the bank and its integrity.
Since all correspondence is recorded and stored in the archives, staff are mindful of their conduct with customers. They are aware of their communications being monitored, which prevents any misconduct.
In addition, it prevents unsolicited financial advice or any recommendation that does not align with the bank’s policies. Identification of any such incident alerts the authorities and prompts the necessary action.
4. Better Performance
File archiving stores unwanted data in a secure space. This includes past correspondences, completed transactions, communication history, and more. Once all such files are archived, they exit the live system. However, they can be accessed with a convenient search system and organized folders.
The live system is relieved of immense data load by storing such data. This reduces the “load,” which might cause lags in the banking system. File archiving also prevents downtime of bank applications. An efficient system benefits employees who can work quickly and effectively without delays.
In uncommon cases, a need to access previous data may arise to address customers’ concerns. Securely stored data with easy access allows bank officials to look into it to solve problems. Efficient customer service is the key to a satisfied customer base, which brings an excellent reputation to the bank.
5. Preparation for Litigation
Certain legal cases require access to the parties’ banking transactions and other relevant data. Courts send legal notices to banks to access needed information in the prescribed time. The stored information in archived systems allows its access whenever required.
Banks access information such as emails, transactions, and contact information for litigation purposes. Stored data with easy access smooths the process. Additionally, it prevents any legal action against the bank for delay in information processing. Correct stored information and its timely provision is a legal responsibility of the banks.
File archiving has become a necessity for the banking sector. The stringent regulations imposed have made it necessary for banks to have a secure data archiving solution. Additionally, doing so provides a seamless experience for the banking staff and customers. It organizes data and preserves confidential information without fear of breach or unauthorized access. Moreover, even if your financial data is lost, you always have the option to recover the data from the archived storage.
To reap the benefits of file archiving, it is essential to use reliable file archiving software. The credible file archiving software will provide convenient and secure data archiving for the finance industry. The complete, customized solutions of the software provide on-cloud and on-premise storage facilities. The software solutions comply with all regulations, so you do not have to worry about anything.
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