Compliance Testing – a must adherence for any organization

On 31-Mar 2022, RBI in India put-up a penalty of 1 crore to a leading Fintech institution. This was a much highlighted news where due to a negligence of Compliance had resulted a fatal huge penalty. 

In the era of Functional and Automation testing, compliance testing may not be performed with the aggression, which ideally it should. Compliance testing is a type of an audit or testing, which is evaluated on the system to check if all the specified standards are met or not. 

Compliance tests are designed to find negligence issues and to ensure all safety standards are met. Compliance has impact on Quality, as result quality gets improved and proven quality is another reason why we should push for compliance testing for the products. Apart from the compliance test, it is also important to conduct periodic audits. The fintech organization could not face a huge penalty, if it would adhered to RBI compliance. The compliance ensures that the rules and regulation of the region, where the organization is performing the business and it is impacting the customers are met. 

In simplest term we may say compliance testing is a process of auditing an organization’s adherence to a law, policy, or state regulation. Through the compliance testing mechanism an organization evaluates the regulatory risks and provides the risk mitigation against it. Compliance for the regulatory adherence is critical, in which organization comply with regulation of local statutory or governing body or local government o federal government. In another mechanism of compliance testing organization also follows the corporate compliance, which ensure that organization ensure that it is working legally. The workforce or labour law with working hour, data sensitivity, pay etc. other falls under compliance as well. This is Essential to realizing is that businesses must be mindful of what’s required from them. Likewise, they must be responsible for what transpires in the workplace to achieve those requirements. 

This is very important to understand that company priority goal should evaluate its compliance. The method protects the organization from legal disputes, fraud, financial issues, etc. Often, the company has an in-house staff to perform the testing or hires an independent company to provide them with this service. The company has an in-house staff to perform the testing or hires an independent company to provide them with this service. 

Hence to summarize the importance of Compliance testing, below are the points 

Safety – Compliance tests are performed to find negligence issues and to ensure all safety standards are met. 

Quality- Improved and proven quality is another reason why we should push for compliance testing for the products. Apart from the compliance test, it is also important to conduct periodic audits. 

Legal Requirements– In some cases, the companies are legally bound to conduct compliance tests before releasing the products. If these tests are not performed legal action can be taken against the company and their license can also be cancelled. 

Conformance– Compliance with the physical standards ensures that conformance and compatibility with other products in the market that might be from different manufacturers.