Diginex is a digital asset financial services and consulting company focused on delivering blockchain solutions designed to make digital assets more accessible. Diginex is focused on providing a cryptocurrency and digital asset ecosystem that delivers innovative products and services that are compliant, fair and trustworthy. The group includes the cryptocurrency exchange EQUOS.io and an over-the-counter trading platform. It also offers a front-to-back integrated trading platform Diginex Access, securitization advisory service Diginex Capital, market-leading hot and cold custodian Digivault, and fund business Bletchley Park Asset Management. The group was founded in 2017 and was listed on the Nasdaq in September 2020 under the ticker “EQOS”.
ClauseMatch is a London-based regulatory technology company that enables financial institutions and other regulated companies to comply with their internal corporate governance documentation (standards, procedures, controls). It is a graduate of the first Barclays Accelerator program in 2014. The solution brings productivity and visibility to the compliance, legal, finance, operations and risk teams, resulting in cost savings, risk reduction and accountability.
Project scope:
The rapid introduction of distributed ledger technology and cryptocurrencies heralds a new era for global financial markets. Agility in compliance is of great importance to a dynamic company that works with digital assets in multiple countries. This is especially true of Diginex as it was recently listed on the Nasdaq. With the implementation of the ClauseMatch solution, Diginex wanted to achieve agile, robust policy and process management, increase efficiency, improve quality and improve standardization.
Implementation:
ClauseMatch was implemented at the Diginex headquarters in Hong Kong. ClauseMatch was originally deployed in the compliance department. The platform is now used throughout the company structure including the back and front office and communicates the guidelines to all employees in the various regions.
The total implementation time for ClauseMatch at Diginex was two months. The project went live at the end of April 2020 after a successful one-month POC and one-month implementation at Diginex. ClauseMatch claims that such projects can be delivered in a month depending on the size of the organization.
The implementation team consisted of a chief compliance officer on behalf of Diginex, a technical architect, a two-person implementation team, and a regional manager on behalf of ClauseMatch.
ClauseMatch solution:
ClauseMatch enables the automation of change management processes by effectively organizing internal guidelines, standards, procedures and controls in its corporate structure (legal entities), regions, products and services (licenses) and regulators. The ability to automatically assess and adapt to regulatory changes brings control, risk reduction, cost savings and efficiency. Because every business has unique compliance requirements, there is no one-stop solution for managing compliance. Hence, everything needs to be tailored to an organization’s goals and the way it manages internal governance.
Solution attributes:
From this project, Diginex received a central repository with internal guidelines and standards as well as regulatory obligations. This meant that documents from all risk and compliance areas were centralized and linked in the corresponding hierarchy. The solution enabled real-time collaboration on policy documents and a full audit trail so that people working on the same document always had the latest version. The traditional user experience has been kept to make it easy to adopt with all changes, comments, approvals, and other metadata captured in each paragraph, and to maintain a comprehensive audit trail.
The solution also enabled mapping between content by linking related content at the paragraph level (e.g. regulatory obligations against guidelines, procedures against internal controls, etc.). In addition, there were algorithms for learning, managing, discovering related content and suggesting new associations. Some additional attributes were an end-user policy portal with reader and attestation rights, mobile device access, and version control.
Main advantages:
Diginex was able to use ClauseMatch’s regulatory technology to manage all policies in an agile manner on a single system, and to share and work on the documents in real time. There was an audit trail with all approvals and comments. A comprehensive full audit trail provides accountability, transparency, and reassurance for the next review of current governance documentation, internal controls, and their links with applicable regulations.
The effective mapping between guidelines, procedures, controls on a granular paragraph level, the linking and mapping of regulations to internal guidelines and the application of AI algorithms. The solution eliminated the need to manually search for a specific point in a document.
The structured workflow increased operational efficiencies through lower investment in staff and consulting fees, shorter audits and impact assessment cycles, increased shareholder value, and clearing the business to focus on growth and innovation.
The solution was well received by the customer at Diginex. The Chief Compliance Officer stated, “Automating regulatory compliance is important, whether you are an international bank or a FinTech startup. Although Diginex is a relatively small team, the application of ClauseMatch technology offers enormous benefits. All of the benefits are very important if you are used to using a very effective tool. This is very important because you scale, changes are automatically applied and you can see exactly which parts of the internal governance documents are affected. Ultimately, we can guarantee the quality of the services we offer our customers around the world, even in such hectic times. “
IBSI view:
With the solution, Diginex benefited from better corporate governance and a proactive reduction in regulatory risk through a 360-degree live view of the current status of compliance with regulatory obligations, which further optimized the impact assessment and the implementation of existing and future regulations.
IMPORTANT FACTS
Financial institution: Diginex
Bank headquarters: Hong Kong
Solution partner: ClauseMatch
Schedule: 2 months for the roll-out
