RegTech in financial services

Adopting RegTech optimises regulatory compliance processes to give you a competitive edge. PwC can help.

What’s RegTech?

For nearly a decade, financial institutions have been making limited progress in cutting the cost of complying with increasing post-crisis regulations. That’s starting to change, with the growth of regulatory technology startups (or ‘RegTechs’) that use emerging technology to assist firms in addressing risk and regulatory challenges.

They help Financial Services (FS) players become more competitive by providing sustainable and efficient solutions that automate the processes banks use to meet their regulatory requirements. From speeding up loan origination to sharpening surveillance against fraud, money laundering and insider trading, financial institutions are now looking to RegTech to improve efficiency and lower risks.

65% of current RegTech funding goes to solutions for financial crime

Considering RegTech?

RegTech: here’s what you need to know

Pilot, pilot, pilot

It’s tempting to direct your compliance team to just ‘plug in’ a RegTech solution. Don’t. Instead, explore a few areas where you think RegTech will pay off and can be deployed quickly, and where new risks are unlikely.

Choose a specific use case to address, like using technology to improve workflow in regulatory reporting.

Know the roadblocks

Many issues can derail a RegTech integration, whether it’s outdated technology, uncertainty over alignment with existing regulations or passive resistance from staff.

A team working on a corrective action plan with a tight deadline, for example, may be less open to conversations about process enhancements. Be aware of the resistance and obstacles you’ll face, create an open dialogue and work towards a common goal.

RegTech: the road ahead

Gathering speed

RegTech adoption is on the rise. Continued interest and development of RegTech solutions can be expected for regulatory compliance, reporting and monitoring in the field of fraud, payments, anti-money laundering, consumer or data protection. Regulators see the technology’s potential to reduce systemic risk and improve financial stability.

While they’re unlikely to endorse specific technologies or common standards, they’re expected to allow firms to test and learn, then assess how RegTech is being used.

Join forces

We anticipate continuous consolidation of RegTech companies. Financial industry buyers generally want integrated offerings with advanced customer support, but many RegTech startups currently offer narrowly focused solutions.

Regulators on the bandwagon

We expect financial regulators to expand their own use of RegTech. Emerging technologies like robotic process automation (RPA) can help agencies process filings more efficiently and artificial intelligence (AI) can be used to help identify misconduct and insider trading.

Géraldine d'Argembeau, Director Compliance - Financial Services

“With the focus of the Financial Services industry progressively shifting to non-financial risks, entering the RegTech universe is the unavoidable option to enhance and optimise regulatory compliance throughout your organisation. When being implemented together with a robust control framework, RegTech is a key ally for boards and management committees to better monitor risks related to their legal and regulatory duties”

Géraldine d'Argembeau, Director Compliance - Financial Services  

How we can help

Leveraging from our extensive experience with financial institutions and RegTech innovators, our RegTech specialists have a deep understanding of the RegTech ecosystem. We’ll work closely with you to build a comprehensive process for assessing the RegTech landscape and integrating emerging solutions fit for your organisation through agile methodologies.

Our FS team will help you build a business case, perform technical due diligence, refine a targeted case and establish priorities to build an actionable roadmap for RegTech implementation. Next, we'll work with you through vendor assessments, solution testing, implementation support, change management and more, so you can start reaping the benefits of RegTech to help maintain your competitive edge and manage compliance risks. 

Find out more

To learn more about RegTech, review our publications below or contact one of our RegTech specialists now.

Contact us

Géraldine D'Argembeau

Director, PwC Belgium

Tel: +32 2710 9455

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