Digital transformations in risk create real business value by improving efficiency and the quality of risk decisions, says the Banking Frontiers February cover story titled ‘Risk Management for the Digital Economy’. The story is based on inputs from 13 chief risk officers from the BFSI sector.
The article quotes Wilson Cyriac, senior vice president and chief risk officer at Federal Bank as saying that there are 3 prominent new risks facing the BFSI sector: “Cyber security risk, data privacy risk and third-party risk are some of the prominent new risks which have emerged out of digital transformation. These new risks are complex and highly dynamic, and the pace of change continues to accelerate. Changes related to the digital transformation augment compliance risk – for example, regulatory and statutory changes around Aadhaar and data privacy,” says he.
Siddharth Kaushik, chief risk officer, Canara HSBC Oriental Bank of Commerce Life Insurance, believes the potential negative impact of continued inaction will be significant for any risk management function, as the likelihood of falling behind the rate of change in the risk ecosystem is high. “Further, institutions could miss out on the opportunity to develop a framework that is fit for the digital age,” he adds.
