People ask me what's actually changed in banking over the last four decades, expecting me to talk about technology, digital onboarding, mobile banking, the usual list. Technology matters, but it's not the real story. The real story is what regulators started worrying about, and that shift tells you almost everything about where compliance needs to go next.
Where We Started: a Fight Against Scarcity
When I entered banking in 1981, joining the State Bank of India as an assistant, the entire system was oriented around a different problem than the one banks face today. We were operating in economies still struggling with poverty, where population growth was talked about as a curse rather than an asset. The job of government and the job of financial institutions, in that era, was straightforward in its ambition even if it was hard in its execution: get financial assistance to the masses so the economy could grow at all.
Reaching people was the challenge. Inclusion was the mission. Everything about how banks were regulated and how they operated flowed from that single priority.
What Changed, and Why It Wasn't Sudden
Somewhere along the way, largely driven by investments earlier governments made in education and the software talent that grew out of it, India's relationship with technology transformed, and with it, banking's relationship with its own customer base. We stopped needing to fight for basic inclusion. We crossed that layer entirely.
Today, the challenge isn't reaching people. It's sustainability, whether the institution itself is robust enough to remain standing, remain trusted, and remain compliant for the long haul. That shift didn't happen overnight, and it wasn't announced with a press release. Regulators have been signaling it gradually for years, through the questions they ask, the areas they scrutinize, the enforcement patterns they follow. Twenty years ago, a regulator's biggest concern with a bank was probably asset quality and capital. Today, it's whether that same institution is properly protecting its customers, whether it's cyber-resilient, whether it can prove, consistently, that it's operating the way it says it is.
The Organizations That Read the Signal, and the Ones That Didn't
I've come to believe this is the single biggest differentiator between institutions that stay out of regulatory trouble and institutions that end up fined or, worse, wound up entirely. It has almost nothing to do with which country they operate in or how large they are. It has everything to do with whether leadership was paying attention to where the regulatory conversation was heading, six months out, a year out, two years out, and adjusted before the shift became mandatory.
Last year, over 100 cooperative banks were wound up for non-compliance. I don't believe that happened because those institutions were fundamentally reckless. I believe it happened because nobody inside them was tracking the direction the ground was moving in, and by the time it became obvious, it was too late to catch up.
I've lived on both sides of the public and private sector divide, 26 years in one, the rest of my career in the other, and people sometimes ask me which side is more compliant. I don't think that's the right question. The right question is which institutions understood that compliance today says nothing about compliance tomorrow, and built the capacity to keep reading the regulatory signal as it kept shifting.
Why This History Matters for What Comes Next
I bring this up because I think a lot of compliance technology gets built for the world as it existed twenty years ago, when the job was proving you'd ticked a box once. That world is gone. The job now is proving, continuously, that you understand where the regulator is heading and that your institution is already there, or close enough that you can demonstrate a credible plan to get there.
That's not a technology problem in the narrow sense. It's a sustainability problem, and it's the reason I think about compliance the way I do. The institutions that will still be standing in another decade won't be the ones with the most sophisticated point solutions. They'll be the ones that treated the shift from inclusion to sustainability as the permanent reality it actually is, rather than a passing regulatory mood.
Dinesh Arora is the Founder of Finnulate AI and has spent nearly four decades in banking, including as Group CEO of a leading East African banking group and as a Board Advisor and Risk Committee Chair for banking subsidiaries in the region.