Why 98% of Financial Institutions Struggle with Regulatory Reporting

Regulatory reporting represents one of the most challenging aspects of card program management, with nearly all financial institutions experiencing significant pain points in the process. Understanding why these challenges persist is the first step toward implementing effective solutions.

The Quarterly Reporting Crisis

For most financial institutions, regulatory reporting follows a predictable crisis pattern:

1. Normal operations throughout the quarter
2. Panic as reporting deadlines approach
3. All-hands effort to compile, validate, and submit reports
4. Brief relief followed by the same cycle next quarter

This reactive approach creates unnecessary stress, increases error risk, and diverts resources from value-adding activities.

Root Causes of Reporting Challenges

1. Fragmented Data Sources

QMR/QOC reports require data from multiple sources:

• Transaction processing systems
• Card management platforms
• Fraud monitoring tools
• Customer service systems
• Treasury and settlement systems

Gathering and normalizing this data manually creates significant effort and error potential.

2. Evolving Requirements

Card networks regularly update reporting requirements:

• Format changes
• New data fields
• Modified validation rules
• Updated submission processes

Without systematic tracking of these changes, institutions struggle to maintain compliance.

3. Resource Limitations

Specialized knowledge is required for accurate reporting:

• Understanding of network-specific requirements
• Technical expertise to extract relevant data
• Compliance knowledge to interpret regulations
• Access to multiple systems and data sources

This knowledge concentration creates key person risks and scaling limitations.

4. Manual Validation Processes

Report validation typically involves multiple manual steps:

• Data consistency checking
• Historical comparison
• Format verification
• Compliance assessment

These manual checks are time-consuming and still prone to errors.

The Progressive Reporting Alternative

Leading financial institutions are shifting from reactive to progressive reporting:

• Continuous data compilation throughout the quarter
• Automated validation as data is added
• Real-time visibility into report completion status
• Early identification and resolution of data issues

This approach eliminates the quarter-end crisis while improving accuracy and reducing resource requirements.

Transformation Results

Financial institutions implementing progressive reporting solutions experience:

• Reporting time reduced from weeks to minutes
• 100% on-time submission record
• Zero fines for reporting errors
• Reallocation of staff to strategic initiatives

The Path Forward

As regulatory scrutiny intensifies and reporting requirements become more complex, financial institutions must move beyond spreadsheet-based, reactive reporting processes. Automated, progressive reporting not only ensures compliance but creates a competitive advantage in operational efficiency.