MiFID II: Application-based vs. network-based recording
Technology can enable the finance sector to achieve compliance through a number of approaches. As far as MiFID II's call recording requirements, the leading technology solutions tend to be application-based or in-network recording. Here, we've summarised the industry's two major approaches, along with the pros and cons, to help you make an informed decision.
Application-based recording
App-based recording is designed to work with a specific type of device, usually Android or iPhone. The software installs on the phone and then controls the call-routing functionality, re-directing calls through a server which records the content.
One of the major downsides to this approach is that this process interrupts the call, resulting in up to 20-second delays to both inbound and outbound calls. App-based recording also fails to tackle the challenges of roaming. When roaming abroad, calls can be routed over long distances, which introduces latency and results in poor call quality and unrecorded calls. However, when using a handset application, an organisation can retain its existing mobile network operator agreement with no need to change SIMs or hardware.
Pros
- Seamless for the user once installed
- Uses existing mobile estate
Cons
- Poor user experience
- Long delays to both inbound and outbound calls
- Unreliable when roaming
- Needs installing on all devices
Network-based recording
Network-based recording does not use an app. Instead, calls are captured directly within the network. Typically, a recording-enabled SIM is used to ensure automatic recording of all subsequent data. Some network-based recording solutions also support users who travel frequently, working seamlessly around the world.
Network recording can also be more cost-effective than other options. Unlike app-based recording, there are no extra calls to the recording software. You only pay for the cost of one call. There are no call delays with network-based recording either, meaning a seamless user experience.
Pros
- Seamless for the user
- Effective even when roaming
- Easy to implement across all devices - Cost-effective
- Call quality unaffected
Cons
- Upfront cost to implement
- Infrastructure may need to be upgraded to cope
Key factors to consider when choosing your mobile recording solution
When complying with new mobile recording regulations, your chosen approach should have minimum impact on your business operations and user experience. Below are the key factors to check when making this decision.
1. Cost: Determine the impact of any changes on existing contracts, estate and budgets. Do you need to seek approval for budget changes? Does this have any other knock-on effect?
2. Strategy: MiFID II regulations apply across the EU, but are there any other markets your staff and customers will operate in? If so, what other regulations do you need to consider?
3. People: Anything that modifies the user experience or expects the user to do something different is likely to fail. Some solutions will send media outside of country borders, introducing latency and affecting the user experience. Is the solution globally available and performing?
4. Technology: If you need to deploy software, make sure it can be centrally deployed to a user's handset.
Talk to us today about how our market-leading, global in-network solution can help you achieve compliance.
