“I started my career as an AI researcher at Stanford, focusing on applications involving highly sensitive data,” says Kalyani Ramadurgam, CEO and Cofounder of Kobalt Labs, NY. “At ApplePay, I worked on fraud detection, sanction screening, and anti-terrorism transaction monitoring. Even then, it was clear how much compliance dictated operations in financial services.”
Ramadurgam made her comments in a recent interview with Travillian Principal – Banking & Fintech Search Keith Daly.
Partnering with a former engineer from Affirm (the San Francisco technology provider for consumer transactions), Ramadurgam became aware of what she viewed as a glaring inefficiency: “There’s so much incredibly manual work in compliance that doesn’t have to be done that way. We believed compliance teams should focus on strategic decision-making, while AI handles the paper-pushing.”
Addressing Compliance Overload in Banking and Fintech
“We didn’t initially set out to focus on financial institutions,” Ramadurgam explains. “We were working across industries, including healthcare, but then we saw an overwhelming demand from community banks and fintechs.”
“Consent order after consent order was coming in, and compliance teams were struggling under the weight of regulatory scrutiny,” she recalls. “Banks were looking for a way to manage these challenges more efficiently. That’s when we realized we were in the right place at the right time.”
Ensuring Data Privacy in AI-Driven Com
“When people hear ‘AI,’ they worry about data exposure,” Ramadurgam acknowledges. “But we don’t train on customer data. We only use it for inference and analysis, without retaining it. That distinction is critical for regulatory compliance.”
She emphasizes that Kobalt Labs does not process real-time financial data. “We’re looking at documentation—InfoSec policies, cybersecurity training materials, contracts—things that are sensitive, but not the same as personal banking transactions.”
“Our clients see that back-office automation is a safe place to start integrating AI,” she says. “It’s not consumer-facing, it includes a human-in-the-loop review, and it provides a clear audit trail for regulators.”
Automating Document Review for Instant Compliance Checks
“At a high level, Kobalt Labs automates document review and identifies areas of noncompliance,” Ramadurgam explains. “Our platform stays synchronized with global financial regulations in real-time, so whenever a new guidance or enforcement action is released, we capture it immediately.”
She describes how this translates to practical use: “If a bank is conducting third-party risk management or reviewing vendor contracts, our system will flag regulatory discrepancies instantly. Instead of an analyst spending hours combing through pages of documentation, they can see exactly where compliance issues exist within seconds.”
Some state regulators have even begun using Kobalt Labs. “I can’t share all the details yet,” she says, “but I can confirm that, as of the past two months, we have state agencies leveraging our platform for their bank examinations.”
Integrating AI Solutions in the Banking Industry
“Banks don’t necessarily need to hire an MIT-trained AI expert,” Ramadurgam notes. “But they do need people who understand how to apply AI effectively.”
She sees Chief Innovation Officers, Chief Technology Officers, and even compliance executives taking the lead in integrating AI solutions. “Some of the best banks I’ve seen have executives who may not know how to code but are forward-thinking enough to embrace technology that makes their operations more efficient.”
Expanding AI Compliance Solutions
“Our goal for 2025 is to double down on what’s working,” Ramadurgam says. “There are still so many fintechs and regional banks that could benefit from Kobalt Labs, and we want to reach them.”
Reflecting on the company’s growth, she emphasizes the importance of listening to clients. “Our customers tell us what they need, and we build for that. We started with design partners who helped shape our product, and now it’s ready for broader adoption.”
The entire interview is available at Travillian Next.
