Document/Records Management
Managing the process of document retention, storage and destruction in the Credit Union industry
Credit Union/Financial Industry Overview
More and more, consumers of all types, especially in the financial world, desire technologies involving digitization. Modern technologies make processes easier and more efficient, reduces errors, improves communication, and changes how consumers see and interact with money.
Managing the retention and destruction of customer and employee records are critical to protect information from being compromised. Not only can a data breach impose a major inconvenience on members of the bank and cost thousands of dollars in fines, but it can also diminish a financial institution’s reputation and credibility.
Bad publicity, legal fees and lawsuits can cost a business millions of dollars. According to the Ponemon Institute “Lost business represented the largest share of breach costs, at an average total cost of $1.59 million.” https://www.secureworld.io/industry-news/cost-of-a-data-breach
Credit unions must compromise between the demands of physical resources and space with regards to retaining all of the records necessary to conduct operations successfully. While the National Credit Union Administration (NCUA) does not specifically regulate record retention policies and practices, they created guidelines to help credit unions figure out how to manage their records. You can read more in detail here: https://www.ncua.gov/newsroom/ncua-report/2016/understanding-what-records-keep
Adopting solutions for converting paper documents to digital files can reduce the turnaround time of solving customer queries from standard 24 hours to less than a minute. Not to mention, the average office worker still uses approximately 10,000 sheets of paper a year and according to The Paperless Project, American corporations “spend over $120 billion on printed forms, most of which become outdated within three months. (Forbes: Going paperless) https://www.forbes.com/sites/forbestechcouncil/2020/04/02/going-paperless-a-journey-worth-taking/?sh=3223d0715ca1.
In addition to the use and print costs, paper costs have seen significant increases over the past couple of years. As companies continue to convert to digital processes, demand decreases and paper manufacturers are converting equipment to products more in demand, such as corrugated cardboard. https://www.printweek.com/news/article/paper-prices-keep-going-up
Document management and storage technology allows individuals to manage documents efficiently and securely, and at the lowest possible cost in terms of both direct expenses and personal productivity.
When you are not prepared or organized:
- Ad-hoc document storage and/or an unorganized or misuse of your document retention policy results in many search hours and unnecessary storage dollars wasted. Every relevant document should be scanned and made available to authorized staff, which often does not happen under the circumstances
- While some documents can be shared with some users, some cannot be. Lack of user and/or group-based security rights can lead to security breaches and unauthorized use of data
- Without a centralized repository, employees do not have access to latest versions or files and need a longer turnaround time to answer customers
- Outdated communication and sharing methods translate to lost time, productivity, and reputation
- Document alerts and reminders – when a document alert system is not maintained or followed, companies can fail to inform customers about policy renewals and other events. With a powerful document alert system, even if a junior executive calls a customer, they can have all the information he needs on fingertips
- Keeping up with new data every day, including financial report, NCUA Call Report and Credit Union Profiles, minutes of meetings, membership applications, general ledgers, and other administrative paperwork takes up your staff’s valuable time
- Not keeping up with protection laws and regulations. In addition, to federal and state laws, businesses may need to comply with other laws such as the Fair Credit Reporting Act, the Fair Accurate Credit Transactions Act, the Sarbanes-Oxley Act and the Payment Credit Industry Data Security Standard
Cohesive technological solutions
A good technological solution will:
- Improve your performance, business processes and services, reduce operational costs and boost profitability
- Reduce the risk of misuse of yours and your client’s documents. A lost document is worth, on average $350; large organizations lose a physical document every 12 seconds, according to iSustainable Earth
- Process applications and customer requests more efficiently
- Meet regulatory requirements
- Should include an easy search function, metadata, reminders, version control, security, and audit trail
- Should give you the option to retrieve digital files through an online cloud storage repository, ensuring your information is accessible whenever you need it
Automate content classifications
Even though we all handle a ton of files every day, very few of us know how sensitive they are, where they are in the content lifecycle, or the policies that apply to them. Classifying files reduces risk and enhances productivity because the right file always adhere to the right policy and users do not have to constantly think about what the rules are for working on the files going through their everyday business processes.
One option and resource would be to hire specialists that are experts in document management systems. They can help you design a secure retention and destruction program so you can manage your physical and electronic records throughout their lifecycles. Automated disposition policies facilitate timely, consistent disposal of data following the industry state and federal laws.
- Help you maintain the privacy of your client’s records and reduce your risk of fraud, theft, and legal fines
- Maintain compliance with all applicable state and federal disposal laws
- Lessen the risk of data breaches with shredding and hard drive destruction options
- Set the right retention schedules and alerts, helping you maintain compliance with state and federal regulations
- Control storage costs
- Reduce time spent in regulatory audits
- Give you the right balance between automatically purging content that no longer has value, restricting permanent deletion to authorized users, and empower users to restore in the event of accidental deletion
- Have shredded materials recycled to support your firm’s sustainability efforts
Secure Storage and Destruction
Cost of using an outside vendor storage space:
- Document preparation (removing staples, paper clips, tape, etc.)
- If you have double-sided documents
- Indexing your boxes or documents for easy retrieval and tracking
- Added security measures to make sure classified or critical documents are secure
- Various types of retrieval options to fit with your business needs, including emergency retrieval, next-day retrieval, regularly scheduled retrieval, and more
- Pickup services for documents that might need to be archived regularly
- Access to your documents whenever you need it
- Storing and retrieval of backup systems for your business (tape rotation and vaulting)
- Proper, secure document disposal when files or records have passed their necessary document retention times. According to Inside Counsel – http://www.insidecounsel.com “it can take $143.49 to destroy a box of records” and it is even more when you consider the labor and time costs of organization, shredding, disposal, etc.
Over time, failing to destroy records you no longer need results in unnecessary storage costs. In highly regulated industries, the consequences can also include regulatory violations, fines, and reputational damage to your business, such as losing client policies, or not holding on to documents for the required timeframes.
A document storage and destruction program is a major transformation initiative. Companies should consider creating a task force representing all the teams and work processes involved. Depending on internal resources, the organization will need to either assign the implementation team or, in some cases, decide what outside resources would be required.
The move toward document digital automation is full of benefits for virtually any business, especially for organizations that are highly reliant on forms and contracts, such as banking/financial services, healthcare, insurance, law firms and government. It would be fitting for every business leader to investigate just what they can achieve by accelerating the journey to a digital document storage and destruction system.