MVB Bank Partners With Kobalt Labs to Modernize Compliance Workflows
Kobalt Labs, an AI-powered platform focused on automating risk assessments and compliance workflows for financial institutions, has partnered with MVB Bank to help modernize the bank’s approach to fintech partner oversight, due diligence, ongoing monitoring and marketing compliance.
The collaboration is designed to reduce reliance on manual compliance processes while improving consistency, scalability and visibility across MVB Bank’s relationships with fintech partners. By deploying Kobalt’s technology, MVB aims to strengthen its risk management capabilities while creating a more streamlined experience for the fintech companies that rely on the bank’s financial infrastructure and services.
The partnership comes as financial institutions face increasingly complex regulatory expectations and growing responsibilities associated with third-party and fintech relationships. Banks working with technology companies must evaluate a wide range of risks, including regulatory compliance, information security, operational controls, marketing practices and ongoing changes in applicable requirements.
Kobalt’s AI-driven platform is designed to help address those challenges by automating elements of the risk assessment and compliance lifecycle.
Automating Fintech Partner Due Diligence
A major focus of the partnership is the automation of compliance workflows associated with fintech partner collaboration and due diligence.
Financial institutions routinely conduct reviews before establishing relationships with third-party providers and fintech companies. These reviews can involve policies and procedures, security controls, regulatory requirements, business practices and other risk-related documentation.
As the number and complexity of financial technology relationships increase, these processes can become resource-intensive. Manual reviews may require compliance professionals to gather documents, assess policies, identify potential gaps, document findings and monitor changes over time.
Kobalt’s platform is intended to automate and streamline many of these activities.
The system supports vendor and fintech partner reviews while helping financial institutions analyze policies and procedures against evolving regulatory expectations. It also assists with security and marketing compliance assessments, providing a broader technology-enabled framework for evaluating third-party relationships.
For MVB Bank, the objective is to create a more consistent and scalable approach to partner oversight while maintaining appropriate regulatory controls.
Enhancing Ongoing Risk Monitoring
Due diligence is only one component of third-party risk management. Financial institutions also need to maintain ongoing oversight after a fintech partnership has been established.
Regulatory expectations, business practices, products, technology environments and risk profiles can change over time. As a result, banks may need to periodically reassess partners and determine whether existing controls remain appropriate.
Kobalt’s platform is designed to support this ongoing process by helping financial institutions maintain more structured and repeatable risk assessments.
Automated workflows can provide compliance teams with greater consistency in how reviews are conducted and documented. They can also reduce the administrative burden associated with repetitive activities, allowing compliance professionals to focus more attention on issues requiring judgment and specialized expertise.
The partnership with MVB reflects a broader industry movement toward using artificial intelligence and automation to strengthen operational processes without removing the role of human oversight.
Addressing Increasing Regulatory Complexity
Financial institutions operate in an environment where regulatory requirements continue to evolve. Banks must maintain compliance programs that can adapt to changes while ensuring that third-party relationships are appropriately monitored.
Kobalt Labs CEO and cofounder Kalyani Ramadurgam said technology is increasingly important for institutions seeking to demonstrate consistent and scalable compliance practices to regulators.
The company’s approach is centered on transforming compliance from a largely manual function into a scalable, AI-driven capability.
For banks, this can involve using technology to standardize processes, improve documentation, accelerate assessments and create greater visibility into risk management activities.
Kobalt’s platform is intended to help financial institutions produce risk assessments more quickly while maintaining consistency and clarity. This can be particularly important when institutions manage large numbers of vendors and fintech relationships.
Supporting Marketing Compliance
Another important component of the MVB and Kobalt partnership is marketing compliance.
Financial services companies and fintech partners operate under regulatory requirements governing how products and services are promoted and communicated to customers. Marketing materials may need to be reviewed for accuracy, appropriate disclosures and compliance with applicable requirements.
As fintech partnerships expand, banks may have to oversee a larger volume of marketing-related materials and activities connected to third-party relationships.
Kobalt’s platform assists with marketing compliance assessments, providing MVB with technology to support the review process.
Automating elements of marketing compliance can help establish more consistent workflows while reducing the amount of manual effort required from compliance teams.
The technology does not eliminate the need for professional review and oversight. Instead, it provides a framework intended to help financial institutions manage compliance activities more efficiently and systematically.
Kobalt’s Growing Financial Services Customer Base
Kobalt Labs has developed its platform for banks, fintech companies and other financial institutions seeking to modernize risk and compliance operations.
The company’s customers include financial technology and banking organizations such as Chime, Upstart, Zions Bancorp, Emprise Bank, Core Bank and Meriwest Credit Union.
The customer base reflects the range of institutions facing increasingly complex third-party, regulatory and operational requirements.
For Kobalt, working with MVB represents another opportunity to apply AI-driven compliance technology within a financial institution that has extensive experience supporting fintech companies.
The partnership also provides an example of how banks that operate at the intersection of traditional financial services and fintech infrastructure can use technology to scale oversight.
MVB’s Role in the Fintech Ecosystem
MVB Bank has established a significant presence in financial technology and embedded finance. The bank supports fintech programs involving payments, card issuance, sponsorship lending and online gaming, working with fintech companies across the United States.
In addition to its fintech activities, MVB provides traditional retail and commercial banking services in its established markets.
The bank’s broader platform includes money movement solutions across multiple payment modalities as well as embedded finance capabilities.
This combination gives MVB a role that extends beyond conventional banking. The institution works with fintech companies that depend on banking infrastructure, regulatory expertise and financial services capabilities to bring products to market.
As these relationships expand, risk management and compliance become increasingly important components of the bank’s operating model.
MVB combines fintech development and incubation capabilities with a focus on regulatory expertise, core banking services and technology-driven operational efficiency.
The partnership with Kobalt adds another layer to that technology strategy by introducing AI-powered automation into partner risk and compliance workflows.
MVB Emphasizes Technology and Risk Management
Larry F. Mazza, CEO and President of MVB Financial, said the organization remains focused on technological innovation and on working with fintech companies developing new solutions for the financial services industry.
The bank views effective risk oversight and management as a central part of its approach to supporting fintech partners while meeting regulatory requirements.
The Kobalt partnership is intended to support those objectives by providing tools that can operate at scale.
For MVB, scalable compliance capabilities are particularly relevant because the bank works with a range of fintech companies and financial technology programs. As the volume and complexity of those relationships grow, technology can help create more standardized processes for managing associated risks.
The partnership therefore connects MVB’s technology-oriented business model with an AI-driven compliance platform designed specifically for financial institutions.
Klaros Group Connects the Companies
The partnership between Kobalt Labs and MVB Bank was facilitated through an introduction by Klaros Group, a regulatory consulting firm that works with both organizations.
Klaros focuses on helping financial institutions modernize risk and compliance programs while maintaining regulatory soundness and operational effectiveness.
Adam Shapiro, co-founder and partner at Klaros Group, highlighted third-party risk management as an area where banks face pressure to increase the speed and consistency of their oversight.
Third-party risk has become an increasingly important consideration for financial institutions as banks rely on external providers and fintech companies for technology, services, infrastructure and customer-facing capabilities.
Banks must maintain oversight of these relationships while managing the operational costs associated with reviews, documentation and monitoring.
Klaros views the combination of its regulatory expertise and Kobalt’s AI platform as an opportunity to help financial institutions strengthen oversight while improving efficiency.
The Role of AI in Financial Compliance
The MVB-Kobalt partnership illustrates the expanding role of artificial intelligence in financial compliance and risk management.
Historically, many compliance processes have depended heavily on manual document reviews, spreadsheets, email exchanges and recurring assessments. While these methods can support compliance programs, they can become increasingly difficult to manage as organizations grow and regulatory requirements become more complex.
AI and automation can help financial institutions organize information, analyze documentation, identify potential issues and standardize workflows.
The potential benefits include faster assessments, greater consistency and improved documentation. However, financial institutions must still maintain appropriate governance and human oversight when deploying AI in regulatory and risk functions.
Kobalt’s platform is positioned as a tool for supporting compliance teams rather than replacing their responsibilities.
For MVB, the technology can help create a more scalable operating model while maintaining the bank’s focus on regulatory obligations and risk management.
Improving the Fintech Partner Experience
The partnership is also intended to benefit MVB’s fintech partners.
Compliance and due diligence requirements can be time-consuming for fintech companies, particularly when documentation must be collected and reviewed across multiple areas of risk.
By automating and streamlining workflows, MVB expects to make the partner experience more efficient while improving its own ability to assess and monitor risk.
A more structured process can provide fintech partners with greater clarity about documentation requirements and compliance expectations. It can also help reduce repetitive administrative work associated with recurring reviews.
This combination of partner experience and institutional oversight is particularly important for banks that position themselves as infrastructure providers for fintech companies.
A Scalable Approach to Third-Party Risk
The collaboration between MVB Bank and Kobalt Labs ultimately centers on creating a more scalable approach to fintech partner risk management.
MVB operates across payments, card issuance, sponsorship lending, online gaming and embedded finance, creating a diverse environment in which partner oversight is an important operational function.
Kobalt’s AI platform provides technology intended to automate portions of that oversight, including due diligence, ongoing monitoring, policy analysis, security assessments and marketing compliance.
For MVB, the implementation represents another step in its broader effort to combine financial services expertise with technology-driven operational efficiency.
For Kobalt, the partnership expands the application of its platform within a financial institution with a substantial fintech focus.
As banks and fintech companies continue to develop increasingly interconnected business models, third-party risk management and regulatory compliance will remain important components of financial services operations. Technology platforms capable of organizing and automating those processes are becoming an increasingly significant part of the compliance infrastructure supporting those relationships.
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