03
Pioneering:
Meet the Innovators
The solutions explored during TestLab 2022 were as unique and varied as the innovators behind them. No matter their size, test participants all shared a similar goal: to experiment, learn, and improve.
Each test participant entered TestLab with their own unique solution. From wealth management to secure document storage, the range of solutions previewed the vast potential for leveraging RegTech in Ontario’s capital markets.
By providing a real-world testing environment and welcoming feedback to make data-driven improvements, TestLab enabled test participants to enhance the impact of their solutions on users. Test participants also learned more about the OSC’s regulatory framework and unique challenges faced by registrants, making it easier for their solutions to hit the mark.
Test participants across various stages of business development unanimously agreed that their OSC TestLab experience encompassed the “ups and downs” of the development process – challenges, triumphs, and all.
Feedback is fuel: With feedback in hand, several test participants enhanced their solutions by developing and adding features and functionalities that catered to the requirements of registrants.
Start-ups and SMEs
Emerging RegTech providers can inject fresh energy and innovative solutions into the market quickly, leveraging their smaller size to remain nimble and responsive to change. TestLab can help these RegTech innovators by providing a controlled environment for testing their new ideas and solutions, refining their products, improving their understanding of the regulatory framework they operate in, and ultimately, launching their products with greater confidence.
LockDocs Inc.
PROBLEM STATEMENT
Enhancing advisor-client interactions
LockDocs is an identity-as-a-service platform that digitizes the customer experience, aiming to allow investors to securely enter their identity-related data once and reuse it across multiple financial institutions for onboarding, transacting, and maintaining compliance. LockDocs’ customizable solution aims to save time, reduce administrative burden, improve compliance and cybersecurity, and deliver a seamless experience for advisors and their clients.
Partnering with an exempt market dealer, LockDocs created custom investor onboarding and subscription forms for its test partner to automate its client onboarding workflow. LockDocs’ test assessed the effectiveness of its solution in collecting, tracking, managing, and processing personal information when completing investor forms. Through surveys and feedback, LockDocs gathered insights into the impact of its solution on efficiency, security, and compliance.
TestLab win
Test partners shared valuable insights with LockDocs, including practical suggestions for improving the solution’s functionality, which LockDocs expects will further enhance the client experience and help registrants review forms for completeness faster and more effectively.
Mako Financial Technologies Inc.
PROBLEM STATEMENT
Enhancing advisor-client interactions
Mako Fintech (Mako) designed an automated solution for refreshing client information for financial services firms. It aims to streamline KYC business processes and workflows, using customized algorithms and incorporating elements like e-signatures, identity verification, anti-money laundering (AML) validation, and connections to CRM, portfolio management, and recordkeeping systems.
Teaming up with a wealth management firm, Mako designed and delivered a customized digital KYC update process. Using an agile and collaborative approach to analyze current forms and processes, Mako created a tailored solution to meet the registrant’s needs. During testing, clients received monthly reminders to update their KYC information alongside their account statements, with built-in survey questions at the end of the KYC update workflow. Mako conducted post-test surveys with advisors and clients for feedback on its solution.
TestLab win
Based on testing feedback, Mako enhanced its solution to notify advisors when clients changed certain categories of information themselves (such as risk tolerance) to help advisors engage their clients to discuss potential implications.
Syntoniq Inc.
PROBLEM STATEMENT
Enhancing advisor-client interactions
Syntoniq is a behavioural tech company that developed Intelligo, a psychometric assessment solution that aims to help advisors and their clients gain an in-depth understanding of the behavioural levers that influence an investor’s financial decision-making. The Intelligo assessment was developed based on research in psychology, behavioural science, and finance to measure cognitive and behavioural factors that directly influence how and why individuals make financial decisions. Upon completion, an analysis report addressing the investor’s eight key behavioural and risk traits is generated and the investor’s Financial Behavioural Personality type is identified.
Syntoniq tested this solution with advisors from a wealth management firm who used it to engage their clients in the risk assessment process. The advisors completed pre- and post-test surveys to track the solution's impact on their workflow and client engagement, as well as the client’s response to the assessment results. Syntoniq also collected back-end system data to analyze the completion metrics and other quantitative data related to the advisors and clients.
TestLab win
Syntoniq had the unique opportunity to present its Intelligo solution to OSC subject matter experts and an OSC advisory committee to hear their thoughts as it considers broadening its solution to self-directed investors.
PW Portfolio Analytics Inc. (Wealthscope)
PROBLEM STATEMENT
Making product information more accessible
Wealthscope joined TestLab for Wealthscope for Advisors, a suite of multi-dimensional portfolio analytics and financial planning tools that aim to help save advisors time and engage more effectively with their clients while also helping clients make more informed investment decisions. Key features include a portfolio scorecard that uses a familiar “A to F” letter grade rating, as well as side-by-side product comparisons, ESG analytics, portfolio builders, and financial planning tools.
As part of TestLab 2022, Wealthscope collected feedback from advisors and compliance staff at registered firms through focused discussions on effective KYP processes under CFRs, limitations and hurdles to adopting RegTech solutions, and Wealthscope’s portfolio scorecard and scenario analysis features.
TestLab win
Through TestLab, Wealthscope used feedback it received to improve its solution, including adding informational “dynamic context boxes” to explain specific insights from financial planning simulations, and a “replace” function so advisors can select a proxy investment product to substitute portfolio holdings that have been excluded from a portfolio analysis due to insufficient trading history. Wealthscope used additional feedback collected from TestLab to inform its roadmap for 2023.
Collaboration is key: Fostering an ecosystem of innovation, TestLab connected RegTech solution providers with each other, registrants, and subject matter experts.
Multinational Enterprises
RegTech innovation is not limited to start-ups and SMEs; multinational enterprises also play a critical role in developing innovative capital market solutions. While they benefit from experience, expertise, and resources, they can face hurdles in navigating conflicting priorities and differences across domestic and international regulatory requirements.
These factors can add complexity to development processes, making it difficult to quickly test and implement new technology to meet the needs of their global customer base. TestLab can help these firms by providing regulatory support for testing in Ontario, enabling them to obtain direct and actionable feedback on their solutions at an earlier stage. This support can help multinational enterprises scale faster and adapt their solutions to Ontario’s capital markets.
TMX Group Inc.
PROBLEM STATEMENT
1.Making product information more accessible 2.Enhancing advisor-client interactions
TMX Logicly is an investment research and portfolio analytics solution that seeks to automate the portfolio management process and streamline investment research for advisors and investors through benchmarking, comparison, and correlation features. TMX Logicly includes an AI-driven portfolio management feature designed to help registrants optimize client portfolios and monitor changes in real-time.
TMX tested with advisors and compliance staff from multiple registrants who used TMX Logicly to support their day-to-day KYP and KYC workflows, compliance tasks, and client interactions. TMX also recruited investors to test the solution for their own portfolio management purposes. Testing was conducted using pre- and post-test surveys, and system usage metrics were collected to assess registrant efficiency and experiences while using the solution.
TestLab win
With support from the OSC Innovation Office, TMX expanded its testing plan to include a risk tolerance and capacity questionnaire that provided insights on the potential to expand TMX Logicly’s scope to be both a KYP and KYC solution.
Broadridge Investor Communications Corp.
PROBLEM STATEMENT
Making product information more accessible
Broadridge joined OSC TestLab to test a new feature in its Smart Advisor platform, designed to provide advisors with objective and consistent investment comparisons on a wide range of investment funds, equities, and ETFs. This enhancement in the Smart Advisor platform aims to highlight the information most sought-after by investors for decision-making purposes in a user-friendly format.
Broadridge recruited advisors from three registered firms to test a demo version of its solution. Test partners provided feedback on the product information sharing and investment comparison capabilities, and how the solution could support client communications. Testing included post-test discussion panels.
TestLab win
Broadridge adopted an agile process to fast-track solution development to align with TestLab 2022, moving away from its standard development process, providing new insights into how it can accelerate development and testing for new features for existing solutions.
Morningstar Research Inc.
PROBLEM STATEMENT
Enhancing advisor-client interactions
Morningstar developed the Morningstar Risk Ecosystem as a methodology that aims to support investment recommendations by assessing a client’s risk tolerance and capacity (KYC) and aligning it with portfolio risk (KYP), on a single measurement scale. The solution uses those results to calculate a total risk comfort range and provide suggestions for client investment portfolios, using a firm's approved product shelf to aid advisors in making a suitable recommendation.
Morningstar tested its prototype solution with advisors through a guided workflow in a simulated web-based testing platform. The goal of testing was to understand the effectiveness of the Morningstar Risk Ecosystem in meeting regulatory requirements and helping advisors communicate more effectively with clients. Morningstar collected feedback from advisors through post-test surveys and interviews, gathering views on potential of the solution to enhance workflows, suitability determinations, and communications with clients.
TestLab win
Morningstar used unmoderated user acceptance testing as the main technique for the purposes of OSC TestLab. Through this experience, the firm gained insights into how to better incentivize solution feedback from registrants going forward and gleaned valuable feedback on the tested solution set.
Partners in progress: Our first event, OSC TestLab Talks, connected 50+ stakeholders to collaborate on how we can create a more dynamic regulatory environment to support innovation in our capital markets while maintaining essential pillars of investor protection and regulatory oversight.