Why Modern Financial Services Firms Are Embedding Regulatory Policy Directly into Development Pipelines
Compliance That Doesn’t Slow You Down
For decades, financial services compliance has been reactive—slow to adapt, disconnected from day-to-day operations, and reliant on manual interpretation and enforcement of policies. But today’s tech-driven firms, especially those in fintech, crypto, and digital banking, are flipping the model.
Instead of treating compliance as a separate department or periodic exercise, they’re operationalizing it: encoding policies directly into infrastructure and workflows. This is the foundation of Compliance as Code—a transformative approach that embeds regulatory logic into systems and processes so compliance becomes continuous, automated, and auditable.
This post explores how leading firms are adopting this model using policy-as-code, regtech platforms, and continuous control monitoring (CCM). We’ll break down real-world examples, walk through what a YAML-based policy file looks like, and explore how developers and compliance teams work together in a shared pipeline.
From Checklists to Code: What Is Compliance as Code?
At its core, Compliance as Code is the practice of defining and managing compliance requirements through machine-readable code. Rather than keeping policies in PDFs, wikis, or outdated Word documents, policies are expressed in formats like YAML or JSON and applied through CI/CD pipelines, cloud infrastructure templates, and policy enforcement engines.
This doesn’t mean replacing compliance officers with code. It means augmenting their work—automating the enforcement, monitoring, and evidence collection of known requirements while freeing humans to focus on strategy, interpretation, and adaptation.
Real-World Use Case: Fintech on the Front Lines
Let’s consider a fast-growing fintech company—call them BitNova Bank—building a new savings product that uses cloud infrastructure and open banking APIs. Historically, compliance would review each new service for regulatory risk after development.
Instead, BitNova implements Compliance as Code. Their infrastructure-as-code deployment (using Terraform and Kubernetes) is governed by YAML-based policy files that define:
- Which ports and services can be exposed
- What level of encryption is required
- How logs must be retained and encrypted
- Which jurisdictions allow certain customer data flows
As developers write code, automated policy checks run alongside unit tests in CI/CD. If someone commits a change that would violate data residency rules, the pipeline fails with a clear, actionable error.
In addition, continuous control monitoring tools evaluate runtime environments, flagging any drift from approved configurations and producing evidence for audit logs in real time.
The result? Faster product development with less compliance risk, and a drastically smoother audit process.
Interview Snapshot: When CTOs and Compliance Speak the Same Language
We brought together a CTO and a Chief Compliance Officer from a real (but anonymized) digital lending startup. Here’s a condensed version of their insights:
CTO:
“Our goal was simple: stop making compliance a bottleneck. With Compliance as Code, we enforce rules at the code level, just like security. And devs don’t hate it—they get fast feedback and clear guidance.”
Chief Compliance Officer:
“We’re still in charge of interpreting the regs and defining policies. But now we work upstream, translating those into logic that devs can understand. We’re not chasing paper trails—we’re reviewing dashboards and managing exceptions.”
This kind of cross-functional collaboration is only possible with the right tooling, shared language (like YAML), and a commitment to integrating compliance early and often.
Anatomy of a Policy-as-Code YAML File
Let’s walk through a simplified example of a policy-as-code YAML file that enforces data encryption at rest for cloud-hosted databases:
yamlCopyEditpolicy_id: enc-001
description: All production databases must have encryption at rest enabled.
resource_type: cloud_sql_instance
conditions:
- field: encryption.enabled
operator: equals
value: true
severity: high
remediation:
message: "Enable encryption at rest on this database instance."
link: "https://docs.example.com/encryption-at-rest"
This file does more than describe a rule—it actively enforces it. It can be processed by policy engines like Open Policy Agent (OPA) or integrated into cloud security posture tools to block misconfigured infrastructure before it goes live.
How Continuous Control Monitoring (CCM) Closes the Loop
Compliance as Code doesn’t end with deployment. Continuous control monitoring (CCM) solutions keep watching. These tools monitor configurations, behavior, and logs across environments to ensure controls stay in place.
In our BitNova example, CCM tools:
- Monitor S3 buckets for public access
- Alert if new microservices bypass centralized identity controls
- Record immutable logs of policy evaluations for evidence
This approach ensures compliance posture is maintained—even as systems scale and change—and provides real-time dashboards and alerts for compliance officers and engineers alike.
Developer Education: Shifting Left Responsibly
One of the unsung heroes of Compliance as Code is developer education. Policies written as code become teachable moments. Instead of vague guidance buried in a policy manual, developers see specific violations, why they matter, and how to fix them.
Many tech-forward compliance teams now run “policy previews” where developers can validate infrastructure against policy-as-code before pushing. Others embed compliance rules into IDEs or use GitHub Actions to show inline suggestions.
This turns compliance from a blocker into a partner—and reduces friction across the board.
The Benefits: Friction Down, Evidence Up
Let’s summarize the benefits of Compliance as Code for financial services firms:
| Benefit | Description |
|---|---|
| Speed | No more waiting weeks for policy reviews. Validation happens automatically in the dev cycle. |
| Consistency | Policies are machine-readable and uniformly enforced, removing interpretation drift. |
| Audit Readiness | All policy decisions are logged and timestamped. No scrambling for evidence. |
| Lower Risk | Misconfigurations are caught early—before they expose the business. |
| Collaboration | Developers, IT, and compliance operate in the same workflows with shared visibility. |
For heavily regulated industries—banking, insurance, payments—this model can make or break innovation cycles. It’s the difference between launching on time and getting stuck in a manual review queue.
Where to Start: A Compliance as Code Checklist
For compliance leaders looking to begin the journey, here’s a basic checklist:
- Inventory key policies that impact infrastructure or dev workflows
- Identify tools your dev teams already use (e.g., Terraform, GitHub, Jenkins)
- Choose a policy-as-code framework (OPA, HashiCorp Sentinel, etc.)
- Define a pilot policy (e.g., encryption, logging, access controls)
- Partner with a few developers to integrate into pipelines
- Layer in continuous monitoring and alerting tools
- Track and publish early wins to build momentum
This isn’t an overnight shift—it’s an incremental transformation. But each step adds agility, auditability, and assurance.
Final Thoughts: Why Compliance as Code Is the Future
In a world where regulations change constantly and development never stops, manual compliance isn’t just inefficient—it’s dangerous. Embedding policy into pipelines and validating it continuously doesn’t eliminate human judgment; it enhances it.
By turning policies into code, financial institutions can go faster and stay safer.
How Connected Risk Brings It All Together
At Empowered Systems, we built Connected Risk to support forward-thinking compliance teams. Our Regulatory Change Management (RCM) and Policy Management modules work seamlessly with:
- Policy-as-Code Frameworks – map your regulations to machine-enforceable logic
- Infrastructure-as-Code Platforms – track real-time violations and remediations
- Continuous Monitoring Tools – keep evidence flowing for audits and regulators
Connected Risk bridges the gap between compliance officers and technical teams—ensuring your rules aren’t just written, but run.
