LONDON, July 23, 2010 /PRNewswire/ -- DataFlux, a leading provider of data management solutions, today announced the findings of a research survey into the UK financial services industry's readiness to meet the legal requirements of the Financial Services Compensation Scheme Reform (FSCS) and the creation of a single customer view (SCV). The legislation requires all UK insurers, building societies and retail and investment banks to create and maintain an accurate view of each customer. The first reporting deadline is 31 July 2010, and full compliance must be achieved by 1 January 2011. The survey, commissioned by DataFlux and conducted by research house JWG, reflects the responses of individuals in the financial services industry that are responsible for the data in their respective companies.

The industry is just getting to grips with FSCS regulation and implementation. There are over 800 deposit holding institutions in the UK to which the FSCS reform applies. The survey found that 50% of respondent firms only began the significant undertaking to develop an SCV during 2010 - the year in which projects must be delivered. Just 59% of respondents had heard of the requirement for single customer view, with a significant percentage (41%) unaware of their regulatory obligations. In addition, 28% of respondents could not identify who owned the SCV within their organisation.

Action from the industry is required to avoid financial penalties and greater scrutiny. When respondents were asked about the consequences they expected to face if their institution failed to meet the FSCS SCV deadline of 1 January 2011, the majority (65%) believed they would incur a financial penalty which could be millions of pounds. In addition, 74% of respondents felt that a failure to meet the deadline would lead to greater scrutiny from the regulator and one- third believed their firm would be at a competitive disadvantage.

Firms recognise data management issues as the greatest compliance challenge.

When investigating the barriers to compliance, four key areas were identified: a lack of business commitment, a lack of resources, poor-quality data and a lack of guidance. In addition, data-related issues were viewed as the most challenging to overcome, with poor-quality legacy data and data quality management earning a 'difficult' rating. Respondents also cited a lack of guidance from the regulator as a barrier to compliance.

A single customer view provides benefits across the enterprise.

Respondents said an SCV benefited a variety of business functions, such as the back office (80%), the risk management department (64%) and the revenue generating departments (40%). However, only 14% saw an SCV project as a strategic opportunity to deliver benefits above and beyond compliance. Since an SCV program can also dramatically improve an organisation's understanding of the customer for marketing and support purposes, the remaining 86% of respondents could miss a vital opportunity to improve customer-facing processes and enhance lifetime customer value.

Colin Rickard, managing director EMEA, DataFlux, commented: This report highlights a shortfall in spending required to create SCVs in order to meet the FSCS requirement for January 2011. This will have to be corrected in the second half of 2010 or firms risk facing significant fines and further reputational damage during 2011. It is clear that data quality and data integration are key compliance challenges. We are working with leading financial services firms to create and validate SCVs across the industry.

PJ Di Giammarino, founder CEO, JWG, added: The customer data issue isn't going away anytime soon. Accurate customer data is critical to the regulatory tsunami as it is fundamental to controlling risk, protecting customers and spotting market abuse. He continued: Five high profile firms have recently been fined a total of GBP7.3 million by the FSA in relation to data errors. The survey findings suggest there will be significant penalties for those companies that neglect the development of a single customer view.

DataFlux helps organisations as they strive to stay compliant to this FSCS legislation as well as gain a more complete picture of their customers: their behaviors, their needs and the potential risks. DataFlux provides customer information management solutions based on industry-leading data quality technology. To learn more, visit http://www.dataflux.com/scv.

About the research

JWG and its partner, MarketingCells, conducted 1:1 interviews with 61 financial services professionals from 44 UK based financial institutions. Respondents were drawn from the fields of compliance, data management and IT. In addition the report is supplemented with insights from four meetings of JWG's Customer Data Management Group which comprises senior risk, operations and compliance officers at major financial services firms. To download the full research report please visit: http://www.dataflux.com About the regulation Following the EU's Deposit Guarantee Scheme Directive (DGSD) of 11 March 2009, all 27 member States are to implement deposit guarantee schemes that will enhance trust in the banking system. In response, the Financial Services Compensation Scheme (FSCS) issued policy statement PS09/18 which stipulated that the 800+ UK deposit holding institutions must implement a single customer view (SCV) to provide a consistent view of deposit holder accounts by 1 January 2011. In addition, deposit holding institutions must submit their SCV implementation plans to the FSCS by 31 July 2011. The aim of this regulation is to enable payment of compensation to a deposit holder within 7 days in the event of an institution collapsing and to inspire confidence in the wake of failed institutions such as Northern Rock. The cost of implementation of a SCV across the industry was estimated at GBP432 - GBP530 million in a 2008 report by Ernst Young.

About DataFlux

DataFlux enables business agility and IT efficiency by providing innovative data management technology and services that transform data into a strategic asset. A wholly owned subsidiary of SAS (http://www.sas.com), DataFlux helps organisations manage critical aspects of data through unified technologies and expertise that provide the benefits of data quality, data integration and master data management (MDM). To learn more visit http://www.dataflux.com.

Media contacts: Nick Ward / Helen Fitzhugh Epoch on behalf of DataFlux +44(0)20-7401-8001 +44(0)7528-377-283 nward@epochpr.com / hfitzhugh@epochpr.com Scott Batchelor DataFlux +1(919)447-3000 publicrelations@dataflux.com PJ Di Giammarino JWG +44(0)20-7870-8004 PJ@jwg-it.eu

SOURCE: DataFlux

CONTACT: Media contacts: Nick Ward / Helen Fitzhugh, Epoch on behalf ofDataFlux, +44(0)20-7401-8001, +44(0)7528-377-283, nward@epochpr.com /hfitzhugh@epochpr.com; Scott Batchelor, DataFlux, +1(919)447-3000,publicrelations@dataflux.com; PJ Di Giammarino, JWG, +44(0)20-7870-8004,PJ@jwg-it.eu