Vendors are increasingly important for banks as they can perform consulting, process transactions, reduce costs and implement controls, all while directing your focus to core business functions and objectives. How many of your bank’s products depend on multiple vendors? How many of your vendors are managing your customers’ private data? For these reasons, regulators have been demanding that banks keep closer tabs on their relationships with third-party vendors.
This has meant risk-scoring, regular monitoring, thorough contracts with service level agreements and on-site visits of vendors. On-site vendor visits are a vital part of ongoing vendor due diligence for financial institutions. They can yield valuable insights into the vendor’s controls and general environment. Going on-site allows you to verify that the controls written are not only in place, but function effectively. There is likely no way to know how well a clean desk or physical security policy is enforced without going to a vendor’s facilities.
Is your company involved in a complex vendor or technology selection project? If so, an on-site visit is recommended. However, these visits can be costly in terms of time and money for a company.
Fortunately, if you’re a VendorInsight® client, you don’t need to personally conduct on-site visits. Our powerhouse due diligence experts can provide you with options to outsource on-site visits.
When to Conduct a Site Visit
After a risk assessment of a vendor is completed, a financial institution should perform due diligence for critical/significant vendors identified during the assessment. Part of this process can include an on-site visit and report of findings.
Visits to vendors, however, can and should be made at all phases throughout the procurement cycle, including:
- The prequalification stage
- The selection stage
- After a contract is awarded
- When rapid growth is experienced or expected
This continuous monitoring using a qualified, independent third-party such as VendorInsight® can regularly test your bank’s controls to manage risks from vendors.
How to Conduct a Vendor Site
VendorInsight® provides you with an experienced industry expert who can offer insight as you make your decision and evaluate vendors. This qualified representative will conduct the on-site visit on your organization’s behalf to validate the controls your vendor is required to have in place.
A primary goal of an on-site visit is to validate claims made in the vendor’s sales presentations and proposals. With VendorInsight® visiting for you, you’ll save time, money and be provided with an objective perspective. Our experts can step back and see the vendor through fresh eyes.
The critical activities of a bank’s third-party suppliers become more important with each new fiscal year. VendorInsight® can help you avoid risks that could damage bank operations by doing your due diligence for you. For more information about how VendorInsight® can provide the most thorough and comprehensive on-site visit for your enterprise, request a demo today.