Regulatory pressures on financial institutions have increased dramatically in the years since the 2008 financial crisis. In response, financial institutions have worked diligently to redeploy resources and rewrite processes in order to comply with new federal rules and avoid costly fines. For the 100 largest banks in the United States, the operational cost of regulatory compliance now exceeds $1 billion annually, and more than one-third of smaller community banks are spending one-third of their operating budgets on compliance. Neither of these statistics represents the additional cost of lost productivity and fewer resources devoted to revenue generating initiatives.

Mail service providers (MSPs) who support financial institutions have an important role to play in helping their clients stay compliant. Those who learn to manage this challenge most accurately and most efficiently will have a significant advantage over their competitors. If you serve financial institutions, or are considering expansion into this space, this is a good time to revisit your own processes for compliance and learn from industry best practices.
Mail operators should be familiar with the Consumer Finance Protection Bureau (CFPB). The bureau was created under the Dodd-Frank Wall Street Reform and

Consumer Protection Act to increase transparency to the lending process for mortgages, credit cards and other financial products to help consumers better understand the costs and risks of borrowing and the terms and conditions of their existing loans. The idea is that a more informed consumer will ultimately result in a stronger and more resilient American economy.

The beginning of the year is a good time for mail operators to review processes and quality checks related to compliance with CFPB regulations. For the foreseeable future, there will be mandated consumer notifications that need to be produced accurately and delivered on time. Your role is to help your clients comply with these regulations by providing:

1. Proof of content: Is the content in every mail piece accurate and compliant?
2. Proof of production: Was each mail piece accurately compiled, addressed and produced?
3. Proof of induction: Was each mail piece mailed correctly? Was it inducted at the right time, in the right place?

Mistakes can result in expensive fines, legal actions and potentially irreparable harm to a company's reputation. Those are the risks, but there are also opportunities. Those who excel in this space are finding innovative ways to reduce operational costs by automating compliance, and they are leveraging mandated notifications to create more impactful customer contacts and stronger customer relationships.

The key is to have an automated work flow and end-to-end integrated tracking and control solution that tracks each mail piece from when the data record was created, through the time it is printed, inserted into an envelope, commingled, and then handed off to the United States Postal Service (USPS) for delivery. Your in-house mailing equipment or commingle provider should have the technology in place to provide you with the corresponding data points for each step the mail piece went through to be inducted into the USPS.

Compliance audits often require documentation so that financial institutions can prove their adherence to regulations. Manually producing these types of documents is inefficient and introduces the potential for lost records and inconsistent reporting. Automated reporting from software or a website portal can make this process more efficient and more accurate.

Innovations in document design and data collection allow mailers to add full color, personally relevant messaging to their physical communications and create tighter linkage between the mail piece and websites, mobile applications, or other digital channels. Producers of regulated First Class mail should take advantage of these innovations and also consider transforming their print operations into White Paper Factories - end-to-end production mail solutions that transform plain rolls of white paper and envelopes into high-impact, colorful and personalized customer communications. A White Paper Factory with digital color print and high-speed inserting can help to improve the integrity and quality of your mailings while eliminating the need to store pre-printed forms and envelopes. This type of production environment also allows for cross-selling opportunities to be printed on the mail piece. These targeted messages can provide a substantial return on investment if the message is clear, concise, personalized and current.

To meet the highest standards of integrity, mailers want to reduce the number of hands and machines that touch each individual mail piece, as well as the number of different software platforms that track it. That's why an automated work flow and a single software platform that tracks the mail piece throughout its life-cycle is essential for mail operations that want to excel in this space.

A Real-Life Example
In 2013, just as banks and financial institutions were beginning to understand the new rules and regulations implemented by the CFPB, L & D Mail Masters, a full-service direct marketing firm based in New Albany, Indiana, saw the opportunity to expand its business further into the transactional mail space. They made a capital investment in equipment and educated themselves on the laws that would impact their new clients. They replaced manual integrity processes with file-based, automated mail piece verification, streamlining their workflow and providing the highest degree of integrity. Today, the investment is not only paying off in the new services L & D is able to provide to transactional mail clients, but also in the improved services they are able to provide to existing direct mail clients.
In her own words, Jill Pedan, business development manager at L & D, said, "By freeing our operators to cross train and redeploy into other areas of our operation, not only does our new system create a leaner production floor workflow, but it also strengthens our productivity as a whole and we can say with confidence that our clients are getting the benefit of the highest integrity, error-free mailing the marketplace can provide."

Just as I encourage financial institutions and the MSPs who serve them to revisit their processes for compliance and take advantage of some of the opportunities they may be overlooking, I would also encourage MSPs who currently do not process First Class Mail for financial institutions to consider expanding into this space. While there is risk in taking on compliance responsibilities, there are also considerable opportunities to create value for your clients.

Bruce Gresham is Vice President of Planning and Strategy for Pitney Bowes Presort Services. Pitney Bowes, a global technology company, powers billions of transactions - both physical and digital - through data management and engagement software, shipping and mailing solutions, and location intelligence offerings. With a network of 32 operating centers across the U.S., Pitney Bowes Presort Services processes more than 14 billion pieces of mail per year and is the USPS's largest workshare partner.