Build Risk Into Product Design Early

A new product can look ready for market until late-stage review surfaces questions about fairness, safety and soundness, disclosures, customer experience, or risk appetite. By then, the bank may already have spent plenty of time and money on technology, processes, marketing, and third-party contracts. 

That is when routine concerns can become expensive problems. Waiting until just before launch for risk and compliance sign-off can turn issues that might have been manageable earlier into red flags and eleventh-hour changes. 

A better path, according to the ProSight Executive Report article “Designing With a Risk and Compliance Mindset,” is to bring risk and compliance into product development while plans can still change. 

Kelly O’Brien, chief compliance officer at M&T Bank and a member of ProSight’s Compliance Risk Management Council, said early engagement allows risk and compliance teams to understand the reason behind a product idea, the customer problem the bank is trying to solve, and the business outcome it hopes to achieve. 

With that context, risk and compliance teams can help identify challenges earlier, suggest alternative approaches, and keep the product aligned with regulatory expectations and the bank’s risk appetite. 

Here are three practical habits for product teams: 

Use the bank’s own evidence. Aoife May, product management associate director at Wolters Kluwer Compliance Solutions, said risk and compliance teams can bring useful history to the design table: complaints, losses, audit findings, customer behavior, and regulatory feedback. O’Brien added that historical data can show where disclosures confused customers, where customers struggled, or where prior products created unexpected risk. Together, those insights help teams design from evidence rather than assumptions. 

Keep the customer at the center. O’Brien said the key is keeping the customer top of mind. Products built around fairness, transparency, and customer benefit can produce stronger outcomes for the bank as well. 

Look around the corner. Risk and compliance teams often monitor enforcement actions, examination findings, regulator speeches, consultation papers, and proposed rules before expectations become formal requirements. That matters especially when products involve AI, where regulatory expectations continue to evolve. 

The takeaway: Bringing risk and compliance in early can make product launches smoother, safer, and less expensive. It can reduce late-stage rework, improve customer outcomes, and help banks design products that hold up after launch. As May put it, “The most expensive compliance issue is the one discovered just before launch.”