Driving innovation through regulation

Business Insight

Running a business, company or organisation is incredibly tough but for some the challenge is even greater thanks to the industry in which they ply their trade.

In order to set standards and protect consumers, some sectors are regulated and in certain instances, must obtain a licence to be able to offer their products and services.

Regulation and licensing is ultimately a good thing as any business should want to meet the highest possible standards and ensure consumers are protected, but it can cause some headaches.

This is certainly true when it comes to innovation and deploying new ideas, especially in areas such as technology, data, payments, loyalty schemes and more.

Below, we look at two sectors that are regulated and/or licensed and how organisations in those industries are pushing boundaries but within the rules set.

Utility companies and technology:

Utility companies, including those for electricity, gas and water, must meet a wide range of requirements to ensure customers receive the best service and at sensible prices.

This, of course, puts incredible pressure on utility companies; they are operating in a highly competitive market where they can be fined and punished for breaching the rules.

To stand out from their rivals and to deliver the best possible product and service to customers, and at controlled prices, all within the guidelines set, companies have had to find ways to innovate.

This has seen many invest in disruptive smart technologies – not only do they improve the quality of service being offered, they help reduce bills for consumers.

This is just what regulators expect of energy companies and in the UK, the government has been incredibly supportive when it comes to the roll-out of smart meters.

This is a great example of how technology allows organisations – whether utility companies, banks, healthcare, etc – to innovate and grow but within the rules they must play by.

Online gambling sites and payments:

The online gambling industry is one of the most tightly regulated in the UK, with operators required to meet stringent requirements around safe gaming, customer onboarding and payments.

The Gambling Commission is responsible for licensing online gambling operators, and recently took the decision to ban credit card payments as part of efforts to ensure players could afford to play.

This meant that operators could no longer allow players to top up their accounts via credit cards and as a result they had to add new, more innovative payment options.

For example, popular online gambling brand, 888 Casino, offers one of the widest range of payment options including PayPal and Apple Pay.

Given the rise in popularity of alternative payment methods, the casino is able to mitigate the impact of the ban on credit card payments with methods that work for new and existing customers.

When it comes to safe gaming and responsible gambling, some gambling brands are looking to automation and artificial intelligence (AI) to better protect players.

AI in particular is being used to monitor individual players and their playing habits – when they play, the size of bets they make, volume of bets, etc – to spot signs of problem play patterns.

If a player triggers as showing potential early signs of problem gambling, then the casino’s customer support team will contact them and open a line of communication.

Again, this is exactly what the Gambling Commission wants to see – operators finding ways of offering a better service and also increasing consumer protections through innovation.

Technology drives innovation through regulation:

These are just two industries where companies have found ways to innovate despite the restrictions being placed on them by regulations and regulators.

Regulation is sometimes seen as stifling innovation, but the best businesses and organisations use it to push forward with new ideas, technologies, products and services.

As a result, the innovations they do come up with are often ground-breaking and drive the greatest improvements and change for their business but also for their customers.

Most of these innovations are powered by new technologies, and as a business in a regulated market it is important to understand the relationship between the two.

So whether that means developing your own technologies in house, or finding companies to work with and innovate together, technology is the best way to innovate through regulation.