Compliance and UX: financial regulation without sacrificing the user experience

Compliance and UX: financial regulation without sacrificing user experience

Respecting standards without complicating the, it's possible. In Switzerland, financial institutions must juggle between strict regulations (LSFin, FINMA, GDPR) and client expectations for simple and smooth services. This involves:

• Simplified onboarding: Reduce long and complex forms imposed by KYC.
• Efficient authentication: Secure without frustrating, thanks to options like biometrics or single sign-on (SSO).
• Increased transparency: Present regulatory information clearly and accessibly.

Solutions like automation or artificial intelligence help meet legal requirements while optimizing digital journeys. By closely collaborating between legal, compliance, and UX teams, it's possible to transform these constraints into opportunities to retain users and strengthen their trust.

Are you a financial institution? Adopt these approaches to ensure security and simplicity in your digital services.

Compliance: optimizing compliance management in banking and insurance through AI [A.Merle]

Swiss financial regulations and their impact on UX

In Switzerland, the regulatory framework imposes strict rules that directly influence the . These rules, essential for protecting consumers and ensuring financial system stability, pose a real challenge for UX teams. They must reconcile complex legal requirements with a smooth and pleasant user journey. Here's how these regulations shape the user experience.

Main regulatory frameworks: LSFin, FINMA, and GDPR

The Financial Services Act (LSFin), in effect since January 1, 2020, introduced strict rules regarding transparency. Companies must provide detailed information on financial products, their fees, and associated risks. This requires integrating elements like pop-ups, explanatory sections, and clearly visible consent forms into interfaces, while ensuring not to overload the user.

The SF Market Supervisory Authority (FINMA) also imposes guidelines that directly influence the architecture of digital platforms. For example, obligations related to anti-money laundering (AML) require robust identity verification processes. This includes steps like uploading official documents, biometric verification, or questions about the source of funds. These processes, while necessary, often lengthen registration steps and require special attention to remain intuitive.

The General Data Protection Regulation (GDPR), although European, also affects Swiss companies operating internationally. Interfaces must integrate tools for managing cookies, privacy preference centers, and options for data portability. In parallel, specific Swiss rules add an additional layer of complexity.

Specific compliance requirements in Switzerland

In Switzerland, certain local particularities further influence UX design. Multilingualism, for example, requires interfaces available in German, French, and Italian. Translations must be precise, especially for terms of use and consent forms, to ensure a consistent and unambiguous experience.

Local formats are also crucial. Amounts must be displayed in CHF with the apostrophe as a separator (e.g., CHF 1'500.50), and dates follow the day.month.year format (e.g., 31.12.2025). These seemingly minor details play a key role in making the interface clear and tailored to Swiss user habits.

Finally, Swiss banking culture, which values discretion and security, strongly influences design choices. Users prefer simple, professional interfaces with neutral colors and classic typography. Additionally, platforms must integrate detailed questionnaires on users' tax residency, especially for those with ties abroad. These forms, essential for legal reasons, must be designed to be as clear and understandable as possible, minimizing the risk of errors.

Main UX challenges related to compliance requirements

For Swiss financial institutions, striking a balance between legal requirements and a smooth user experience (UX) is a real puzzle. Although necessary, regulations can sometimes create obstacles in digital journeys. It becomes crucial to design solutions that ensure both security and ease of use.

Authentication systems: security and ergonomics

Traditional methods, like username and password, are no longer sufficient against increasingly sophisticated cyber threats, such as phishing or malware. Regulators, like the European directive PSD2 or the recommendations of the FFIEC, require enhanced authentication systems, especially for sensitive or high-risk transactions ^[1]. The challenge? Implementing these protections without unnecessarily complicating users' lives ^[1].

Take the example of multi-factor authentication (MFA). While sending a code via SMS may seem simple, it becomes problematic in case of network failure or during international travel. Security questions, while useful, remain vulnerable to attacks and require regular rotation to remain effective. But this additional complexity can frustrate users and harm their experience.

After exploring the challenges related to authentication, let's now focus on another key aspect: consent management.

User consent and transparency in data sharing

In the financial sector, consent management is a central issue. Institutions must ensure that authorizations for using sensitive data are collected clearly, freely, and explicitly, while allowing users to easily revoke them ^[3].

Another challenge lies in data portability, which requires intuitive interfaces to allow users to export their information. This is particularly critical as the financial sector ranks sixth in terms of total fines related to data management ^[3]. Moreover, even when third parties are involved, the responsibility to ensure the security of this data remains entirely on the shoulders of financial institutions ^[2].

These efforts aim to reconcile regulatory requirements with an optimized user experience, minimizing frictions while strengthening user trust.

Practical methods to reconcile compliance and UX

Facing the challenges mentioned earlier, here are concrete strategies to turn these obstacles into improvement opportunities. By combining compliance with regulations and optimized user experience, Swiss financial institutions can offer effective and tailored solutions. These approaches are based on user-centered design principles and technologies in line with local regulatory frameworks.

Creating simple and effective forms

Simplify forms by dividing them into logical and progressive steps. This method guides users throughout the process, reducing their cognitive load. Auto-completion is a key tool here: it can pre-fill fields using already entered data or reliable public information. For example, after entering a Swiss company number, the system could automatically complete the company name and address from the commercial register.

Real-time validation is another essential element. It immediately flags format errors or missing fields, thus preventing users from discovering issues after filling out the entire form. For sensitive data like IBAN, instant format checks can be integrated while respecting privacy standards.

Add visual indicators to show progress in the process. These markers are particularly useful in complex journeys, like financial onboarding, often perceived as tedious. These techniques are not limited to forms; they also apply to access security, as explained below.

Building secure and practical authentication systems

Modern authentication systems must combine security and simplicity. Adaptive authentication, for example, adjusts the security level based on the connection context (location, device, time, usual behavior). This strengthens security without burdening the user experience.

Biometric solutions, like fingerprint or facial recognition, offer quick and reliable identification. These technologies, now common on mobile devices, reduce risks associated with passwords while speeding up the login process.

For multi-factor authentication, offer multiple options: push notifications, app codes, secure emails, or SMS. This flexibility helps avoid disruptions in case of unavailability of a specific channel.

Finally, Single Sign-On (SSO) plays a key role in financial services. By allowing users to authenticate once to access multiple services, you simplify their journey while maintaining a high level of security. This approach reduces the fatigue of multiple logins, a common frustration for users.

Improving transparency through clear design

Regulatory transparency should not be limited to complex legal text blocks. Well-thought-out design can turn these obligations into an asset for the user. For example, a layered design can display essential information first, with additional details accessible on demand.

Interactive info-bubbles and contextual links are particularly useful for making information understandable. Instead of imposing endless terms and conditions readings, provide short and relevant explanations when needed.

Adopt a clear and simple language to explain authorizations and privacy policies. Avoid legal jargon. For example, instead of "processing personal data for commercial profiling purposes," prefer "we use your information to offer you services tailored to your needs."

Privacy dashboards offer users precise control over their data. Present authorizations as simple switches, accompanied by clear explanations of the consequences of each choice. This approach facilitates informed consent while avoiding information overload.

Finally, consent history and change traceability enhance user trust. By allowing users to view and modify their choices at any time, you demonstrate your commitment to transparency and respect for their privacy. This feature goes beyond regulatory requirements by showing your willingness to put the user at the center of your concerns.

Implementation steps for Swiss financial platforms

To effectively transform a financial platform, it is necessary to combine technologies, internal processes, and interdisciplinary cooperation. The goal? Introduce these changes without disrupting existing services or compromising data security. These actions build on the practical methods discussed earlier, while respecting the UX strategies mentioned above. The result: rigorous compliance that does not sacrifice user experience.

Collaboration between legal, compliance, and UX teams

Success relies on close collaboration between often siloed departments. Lawyers bring their expertise in financial law, compliance managers ensure standards compliance, and UX designers ensure a smooth and intuitive experience.

For this, it is crucial to establish mixed working groups bringing together, for example, a Swiss financial law expert, a FINMA compliance manager, and a UX designer specialized in financial services. These teams must meet regularly to analyze user journeys from all angles.

Co-creation workshops are an effective method to harmonize regulatory constraints and UX goals. Take the example of redesigning an onboarding process: the legal team could explain the identity verification requirements imposed by LSFin, while the UX team would identify current friction points. Together, they can develop solutions that meet both regulatory requirements and user expectations.

Another key element is developing a common language. Complex legal terms must be translated into understandable functional requirements for designers and developers. Conversely, UX concepts must be explained considering their impact on compliance. Clear communication between teams reduces misunderstandings and speeds up decisions.

Automation and AI in compliance and UX

Automation and artificial intelligence play a central role in optimizing processes while ensuring compliance with regulatory standards. These tools are particularly valuable for managing large amounts of data accurately, as required by Swiss regulators.

• Automated document validation: By automating this step, processing times go from several days to a few minutes, while meeting FINMA standards. The result? A quick response for the user and a reduction in operational costs for the institution.
• Real-time behavioral analysis: These systems detect suspicious activities without disrupting the user experience. They learn user habits and only intervene in case of significant anomalies.
• Specialized chatbots: These virtual assistants instantly answer compliance-related questions, whether about customer rights or complaint procedures. They allow human teams to focus on more complex cases requiring in-depth expertise.

Continuous optimization through feedback and monitoring

Maintaining a balance between compliance and user experience requires a continuous improvement approach, based on precise data and regular user feedback. This approach helps quickly identify issues and provide tailored solutions.

Implement real-time monitoring tools to track key indicators like completion rates, dropout points, or processing times. These dashboards offer an overview that highlights the impacts of regulatory changes on the user experience.

Adopt a proactive regulatory monitoring to anticipate new legislations and their potential impact. This anticipation allows for necessary adjustments before they come into effect, avoiding rushed modifications that could harm the user experience.

Finally, establish internal feedback mechanisms. Employees in direct contact with clients have valuable insights into encountered difficulties. These feedbacks complement analytical data and offer a finer understanding of user needs.

To ensure continuous improvement, set up a monthly analysis cycle. Teams review the past month's performance, identify optimization opportunities, and plan the next corrective actions. This regularity maintains improvement as a permanent priority, beyond crisis moments.

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Conclusion: Respecting compliance standards while maintaining quality UX

For Swiss financial institutions, combining regulatory compliance and user experience is no longer an impossible mission. The described approaches show that it is entirely feasible to meet the strict requirements of FINMA, LSFin, and GDPR while offering clear and enjoyable user journeys.

The key lies in close collaboration between legal, compliance, and UX teams from the early design stages. By working together, these teams transform regulatory challenges into opportunities to create transparent and reassuring interfaces that inspire user confidence.

Thanks to automation and artificial intelligence, the complex aspects of compliance are managed in the background. This simplifies interfaces, optimizes processes, and ensures high security standards.

Finally, real-time monitoring and analysis of user feedback offer rapid adaptability to regulatory changes. Institutions investing in these technologies stand out in the Swiss financial market, where customer trust is a crucial asset. By adopting a user-centered approach while respecting standards, these platforms strengthen their position as leaders and prove that compliance and user experience can go hand in hand to build a solid and accessible digital financial ecosystem.