Compliance ROI and Collaboration with Harsha Raghunath, Director of Compliance at Mercury

In this episode of the COMPLY Podcast, we’re joined by Harsha Raghunath, Director of Compliance at Mercury, for a conversation on what it looks like when compliance is built into a company from day zero. Harsha shares how Mercury’s foundation of compliance shapes everything from product development to cross-functional decision-making, and how his team keeps pace in a fast-moving fintech environment without slowing down innovation.

We also dive into how Mercury leverages technology to streamline compliance, and Harsha offers candid advice for early-career professionals on building credibility, staying current, and navigating common challenges. Plus, we highlight the important work happening through the Coalition for Financial Ecosystem Standards (CFES) to raise the bar across the industry.

Mercury is the fintech that brings all the ways people and businesses use money into a single product that feels extraordinary to use. Anchored by a powerful bank account*, Mercury gives more than 200K ambitious companies and entrepreneurs the banking, credit cards*, and software they need to power all their financial workflows. To learn more, visit Mercury.com.

*Mercury is a financial technology company, not a bank. Banking services provided through Choice Financial Group, Column N.A., and Evolve Bank & Trust; Members FDIC. The IO Card is issued by Patriot Bank, Member FDIC, pursuant to a license from Mastercard®.

Show Notes

• Connect with Harsha: https://www.linkedin.com/in/harsha-raghunath-14a27a62/
• Connect with Rhonda: https://www.linkedin.com/in/rhonda-mcgill/

Transcript

Rhonda:
Hey there COMPLY Podcast listeners, and welcome to this week’s episode. Today we’re talking with Harsha Raghunath, Director of Compliance at Mercury, about how compliance can drive collaboration, deliver real ROI, and enable business growth. From building with compliance at the core to proving its value across teams, Harsha shares practical insights for making compliance a strategic partner instead of a roadblock. Thanks for listening, and enjoy.

Rhonda:
Greetings, COMPLY podcast listeners! This is Rhonda McGill, and I'm the host for today's podcast. Joining me is Harsha Raghunath, the Director of Compliance at Mercury.

Today, we're going to talk about Harsha's background, shifting perspectives around compliance, measuring compliance ROI, and leveraging technology. So this should be a really good conversation with us today.

Harsha, thank you so much for taking time out of your schedule to join us. Can you share a little bit about yourself with our listeners?

Harsha: 
Yeah, Rhonda, it's great to be here. Thank you for inviting me onto the podcast. I'm Harsha, the Compliance Director at Mercury.

I'll start with a little bit about myself. I've worked in compliance and compliance-adjacent roles for the last 10-plus years. I started my career in Big Four consulting with large financial institutions that were really busy with regulatory scrutiny and enforcement actions in the post-Dodd-Frank era, following the creation of the CFPB.

Since transitioning to fintech, I’ve been operating at the intersection between traditional compliance work and product advisory, helping to ensure that product-led companies have the right mindset as they're building regulated products. I started my FinTech journey at Paxos, in the regulated crypto space, before moving over to Stripe, which is a large payment acquirer, and now Mercury, where I’ve been for the last year and a half.

A little bit about Mercury. Startups and other companies use Mercury for banking, credit cards, and financial workflows. Our main thesis is that it's difficult for startups to access the financial products they need to launch and scale a business using traditional financial services and banking offerings.

What sets us apart is that Mercury is a fintech, we're not a bank. We work with partner banks to provide our core banking services. This allows us to invest deeply in our product, user experience, and in helping more companies succeed in their missions.

Rhonda: 
Thank you so much for sharing that. I guess as we're jumping into this discussion, one of the things that I've seen is that Mercury was built with compliance as a priority from day one.

How does that foundation shape how your team operates today, and what lessons do you think other companies can take from it?

Harsha: 
Yeah, absolutely. I think here at Mercury, we have the philosophy that compliance is what keeps the door open for our customers and enables us to continue innovating and offering the products that’ll support them in the long run.

You're right that Mercury was built with a strong foundation in compliance, and it's that strong foundation—as well as my personal passion for the products and services that we offer—that led me to join Mercury about a year and a half ago. I've spent my time here embedding compliance into everyday operations—everything from product development to marketing to sales.

As a compliance professional, it's always great to get somewhere where the foundations are already there, so you can focus on things like scalability and resilience—and that's what we've done. We also have the philosophy that it's important to give teams the tools and the extra sets of hands to handle complex compliance needs, because they're tackling complex business problems.

Absolutely, it's not just about the policies and training. It's about supporting the business throughout the product development cycle and then throughout the product life cycle itself. For us, we've had a lot of success investing in product compliance as a function. And what we've found is that it’s a way to prevent costly remediation as well as elevate how people think about compliance internally.

We take an embedded compliance model, which means that there are compliance professionals on my team sitting alongside the product teams that are building all of our innovative new things. What we’ve found is that it has become a business enabler, and compliance is no longer seen as the blocker that it often is in traditional spaces.

Rhonda: 
So that, that leads me to my next question. So we know that with compliance and with business, speed is everything in fintech, how do you make sure that compliance keeps pace without becoming the reason a great product misses a moment? 

Harsha: 
Yeah, it's a great question. I think every compliance team, function, and professional wrestles with this, absolutely. I can at least share the mindset that we bring within our compliance function, which is that we like to treat compliance as a product or a service that we're offering internally. We treat our internal stakeholders as customers.

And yes, as a company, we move fast, but we know that we cannot break things because we're dealing with people's money. These are businesses that are just off the ground or in the process of scaling, so it's incredibly important that we bring that product mindset, but without applying the traditional product development mentality in every instance.

For us, I think the crucial aspect here has been being in the room—not when a product is about to go live, not when it’s already out in the market—but from ideation through to launch. That’s really our first foray into the business. You really can't come in when a product is ready to ship. You're going to have gaps, you're going to have things that people haven't thought about exactly. You have to be a part of shaping that product with the teams. 

Rhonda:
That's important, what you just said. That is like spot on. One of the key wins for any compliance team.

Harsha: 
Yeah, absolutely. And with that, you have to deliver on the promise, right? If you go and embed yourself with a product team, you have to be able to show the value that you're driving by being in the room, working alongside them, and being included in that operating cadence.

One thing that we like to do here, as we think about being engaged early, is what we call "t-shirt sizing." It's our attempt at giving our product stakeholders and business teams a quick sense of the compliance lift involved in what they're contemplating.

So if they can get a signal early on that their new idea is maybe a small t-shirt size, that means there's a lighter compliance lift, lower risk in general, and we don't need to be as involved. Or, if it's an XL-sized t-shirt, then we know we're going to need to be involved every step of the way. That actually gives them a signal as to when to bring us in and how to include us in their operating cadence and model.

It makes us better partners to them and helps us avoid being that bottleneck.

Rhonda: 
And that's great that you're doing that, because it helps them shape their mindset around how compliance is going to see the projects they're working on—like, “Oh yeah, this is definitely a large,” or, “This is an extra large,” and so we need to consider that as we're moving forward with compliance.

Thank you for sharing that. I've only ever seen t-shirt sizes used with a product team, so it's really great to hear you sharing that as a compliance tool.

So, let's talk a little bit about measuring compliance ROI. How do you approach measuring ROI in compliance, and what metrics or outcomes do you look for when you're trying to show the business impact? I think this is a struggle for a lot of compliance teams.

Harsha: 
Yeah, I think we do it in a couple of different ways. One is the more tangible and traditional approach to measuring ROI, which is looking at issues, looking at remediations, looking at the work that a business or product team has to do to fix things they maybe didn’t consider earlier in the process. I think that's pretty standard and fairly easy to measure in terms of a metric—if you want to call it that.

But I actually like to think about it more intangibly. For one, as a compliance function, we take the mentality that our success is as tied to the business goals as the business’s own success is. That doesn’t necessarily mean that our goal is to grow customers by X percent or anything like that, but we really think about, "Hey, the business wanted to ship this new, innovative, really cool thing—could we be a part of making that happen and doing our job along the way?"

So that's one way—looking at product launch timelines. Are we shipping on time? Are we part of that process?

The second one is probably even more intangible, and really requires you to build strong relationships with your product stakeholders. Do the teams want us in the room? And when do they want us in the room?

If you can get a good sense that your product stakeholders are braving support from compliance, that means we're adding value to what they're doing. And so, again, it speaks to embedding ourselves into the work of the business and really helping it move faster.

Rhonda: 
So based on that, can you share an experience where compliance made a product or a process better, and not just safer?

Harsha:
Yeah, sure. I think there's probably no more relatable example than one in the customer onboarding space. I think every fintech has wrestled with these types of challenges.

One example that comes to mind from earlier in my career, before Mercury, was when we were trying to onboard existing customers to new banking relationships as part of our platform offering. And as you can imagine, for customers who had already gone through onboarding with us, they found this experience confusing at best—and probably frustrating at worst.

Rhonda:
Exactly.

Harsha:
So our challenge was finding a way to meet all of our internal requirements, fulfill our bank partners' compliance obligations, and still make it seem seamless to the customer.

The approach we took was one of partnership, particularly with our counterparts at the bank partners. Now, we had been successful in building trust with them over the years, so seeking nuanced ways to meet their needs was a path we were willing to take.

We led the negotiations—compliance led the negotiations—with our compliance counterparts to find a solution: to reuse data that we already had on file, confirm it was still current with our customers through an in-product experience, and avoid reverifying data that was still accurate if the customer had onboarded within a pretty recent period of time.

Our product stakeholders were pretty thrilled with this outcome because we were able to find a middle ground that could be finessed into the customer experience while not compromising on our commitment to compliance.

If we didn’t care about the customer experience as part of this process, we as a compliance function probably would’ve been fine with a clunky and suboptimal customer experience. But that’s not the type of function we want to be, right? Compliance shouldn’t be a check-the-box function, but really one that cares deeply about the shape of the product.

Rhonda: 
That's great. So we're in this new age of all things AI and the usage of so many different technologies. I’d love to know—how is Mercury using technology to enhance compliance processes, and what's been the most effective for you all?

Harsha: 
Yeah, technology and tooling is definitely a pet project of mine, and it’s one that really never ends in our field.

It's part of the job. And I think, one, we're always looking for ways to bring on new technology or tooling to make our process better. And we subscribe to the belief that if you're not thinking about the next technology to make your function better, you're going to get left behind. 

So we've employed a mix of traditional regtech solutions and more bleeding-edge AI, but we also follow some pretty defined principles. 

One—technology as it stands today isn't really about replacing people. It's about making them more effective. Two—the tools and the technology we use should amplify judgment and not replace it. 

So I'd love to give you a couple examples of where I think we found a lot of success with tooling. We're customers of PerformLine, and your tool has helped us cover a much larger surface area than we could have if we were doing these reviews manually. 

For us, our name, our reputation, our status as a fintech and not a bank—these are all critical for our long-term success. So PerformLine has helped us to monitor our own first-party marketing activity, as well as the activity of our external marketing and referral partners that we foster as part of our go to market strategy.

We've also had some success with with Gen AI in building kind of custom GPTs that allow our compliance professionals internally to accelerate our reviews. And, most compliance professionals would probably agree, we have this ever-growing mountain of documentation to review—internal policies, procedures, all of our bank partner requirements. And building these custom GPTs has allowed us to synthesize things like requirements libraries, assess procedures for adherence to internal policies, better organize our work.

And I want to emphasize that while we haven't necessarily replaced compliance work with these tools—we still have some of the best compliance professionals in the business doing these hands-on reviews—we have been able to operate faster and with what we call a "digital second set of eyes." And that's been really successful, probably over the last six months.

Rhonda:
And the human touch! I always tell people that the human touch is always going to need to be there because you're going to always need that human set of eyes. And you just can't go without a human being being a part of the process.

Harsha:
No AI tool, at least not today, can replace years of experience and industry knowledge. And that’s how we think about leveraging these tools. We really do rely on and lean on the expertise of our people, first and foremost.

Rhonda:
They just get a chance to be a little bit more strategic and do some of that extra stuff that they wouldn't be able to do if it was all a manual process.

Harsha: 
Exactly.

Rhonda: 
For sure. So I'd love to talk a little bit about the Coalition for Financial Ecosystem Standards. Can you tell us a little bit about CFES and why establishing shared standards across the bank and FinTech ecosystem is so important right now? I know there's a lot of conversation about it, and this is a space where this is happening. Can you talk to us a little bit about that?

Can you talk to us a little bit about that?

Harsha: 
Absolutely. CFES is something we're really excited about, and Mercury is a founding member of this coalition. We’ve been very fortunate, as a founding member, to be part of shaping the standards that are being promulgated by the group.

By way of background—everyone who works in this space, especially those of us in compliance, knows how important regulatory clarity is, and how valuable it is to have a clearly defined set of standards to align to when shaping our programs. But there’s a gap out there today.

CFES is a cross-industry effort to create practical, adoptable, rigorous standards that help not only fintechs, but also banks—and the banks' regulators—align. For us, it’s less about waiting for a rulebook to be handed down, and more about being part of writing it. Writing clearer standards to make it easier for fintech and banks to partner and, most importantly, to do so responsibly, as stewards of the financial system.

Rhonda: 
Wow. So this is like a, the whole ecosystem coming together to really impact the outcome. 

Harsha: 
Yeah it's been great so far.

And the standards—really, the way they're structured—is not about creating a set of requirements that every single fintech needs to adhere to on day one. Instead, it's a set of standards that takes into consideration that some new, innovative companies might be pre-revenue, they might be in an early stage, or they might be fully scaled.

The standards are built and structured in a way that’s flexible so you can assess how well your program is doing based on where you sit in the market and who your bank partners are

Rhonda: 
That's great. Thank you so much for sharing that, and I hope that folks will take an opportunity to learn more if they haven't already.

So I'd like to address some of the career growth questions that we get—challenges to help the less experienced compliance professionals as they're starting to really navigate. Some of them have probably been in their careers for a while, but maybe they're having some of those struggles.

So here's a good question:

“Sometimes I struggle to explain the value of compliance beyond just saying, ‘staying out of trouble.’ How can I better communicate that to my team or leadership?”

How would you respond to that individual?

Harsha: 
Yeah, I guess my first response would be that compliance is, at its core, about staying out of trouble and protecting the company. It’s about keeping within the guardrails that have been established out there.

But I think the messaging that probably resonates best, at least in my experience, is this: customers want to work with businesses they can trust, and compliance is a trust-building mechanism. Especially in fintech, it’s become table stakes. Everyone is looking for ways to make compliance part of their offering to build that trust within the environment.

So sure, you can take the approach of “staying out of trouble” and say that’s the core mandate. But ultimately, there’s a cost to the trouble you do get into. Another way to think about it is that compliance can help you avoid getting into those stickier situations that sometimes result in costly remediations or end up eating into your margins.

If you make the business case, that’s been the message that’s resonated most with senior leadership in my experience.

Rhonda: 
Love that. So how do you stay up to date with the changing regulations without feeling overwhelmed? And what do you prioritize? 

Harsha: 
Yeah, it’s interesting because there’s so much out there. You go through these cycles where there’s a ton of rulemaking, enforcement actions, and regulatory guidance, and you really do want to make sure you’re on top of all of it.

That can be hard, especially if you’re at an earlier stage and your compliance function isn’t heavily specialized. For earlier-stage fintechs, probably the simplest thing you can do—especially since everyone operates out of Slack these days—is set up RSS feeds. It’s an older technology, but they still work.

You can set up RSS feeds in Slack to deliver regulatory updates. Of course, you still have to parse through them and figure out whether they’re relevant to your business. But it’s a way to bring that information into the space where you’re already working every minute of the day.

As compliance functions grow and become more specialized—with one team focused on consumer issues, another on securities compliance, and another on BSA/AML—then you can start delegating that monitoring to the right teams. Those teams usually have the subject matter expertise and are best equipped to stay on top of developments in their areas.

There’s also a lot of tooling out there, like red feed-type tools. We’ve had mixed success with some of those. So for me, the approach is this—make sure the RSS feeds are set up, let the specialized teams focus on their domains, and subscribe to updates from regulators and key law firms to stay informed.

Rhonda: 
So important. And I guess my last question for you, I really thank you for taking this time and I think you've given some really valuable information to folks, but what is the one thing that you wish you knew earlier in your compliance career?

Harsha: 
I wish I knew how fun working with product teams was earlier in my career, so I could have been doing it sooner.

There’s really a wide scope of compliance roles for professionals who are either mid-career, just getting started, or anywhere in between. If you go into the traditional financial services space, there are a lot more conventional compliance roles. But I do think that as you move toward FinTech and product-led organizations, there’s a real opportunity for compliance to partner with business functions in a way that you maybe don’t get as much of in the traditional space.

For me, I get a lot of personal job satisfaction, motivation, and enjoyment out of working with product teams—understanding their process, seeing how they think, working with engineers, and seeing how they approach problems, which tends to be very different from how compliance professionals think. And being a part of launching those products that then take off and have a ton of product-market fit is incredibly rewarding.

So I think it would be this: find the type of compliance work that you're most interested in doing. Some people might prefer testing or oversight work and get less involved in the product development lifecycle. But there's such a wide range of roles out there that there's really something for everyone in our space.

Rhonda:
I couldn’t agree more. And I would say for me, mine was always marketing. I always gravitated toward marketing because I felt like consumer protection—being on the front line of it—is so important. That was one of the areas I always focused on: marketing compliance. I got the most pleasure there.

I tried other areas, but I always kind of leaned back toward marketing compliance. I just always felt like making sure you're delivering the right product to the consumer is so important. But making sure they understand it, and that they're seeing the right visual, and that it makes sense—that's critical too.

Harsha:
Yeah, absolutely. If you want your work to have the most eyeballs, marketing compliance is the way to get there because it’s the front of the business. Anything go-to-market related tends to be truly impactful work, and I think it can be very rewarding for a lot of compliance professionals as well.

Rhonda:
The storytellers—that’s what they used to call them, the storytellers.

So Harsha, I can’t thank you enough for taking time out of your schedule to be here with us today. I know you all over there at Mercury are so busy, so I really appreciate you taking the time and sharing all this great information with our listeners. We’d love to welcome you back anytime—to join us here at the COMPLY podcast, or in any of our other opportunities, webinars, or what have you.

Thanks again for joining us today.

Harsha:
Thanks, Rhonda. Really appreciate the opportunity. Thanks a lot.

Rhonda:
Thanks for listening to this week’s episode of the COMPLY Podcast! As always for the latest content on all things marketing compliance you can head to performline.com/resources. And for the most up-to-date pieces of industry news, events, and content be sure to follow PerformLine on LinkedIn. Thanks again for listening and we’ll see you next time!