Operational Excellence

RegTech: The Real Benefits for Financial Services

By Colm Dowd 16 January 2023

It’s an inescapable fact: managing compliance manually is increasingly impractical – not least because there are over 750 regulators and an average of 200 regulatory alerts every day.

Enter RegTech – the latest buzzword to sweep the digital transformation scene. In this blog, I’ll break down the tangible benefits of RegTech to help you see through the hype.

A reminder on RegTech

Regulatory technology (RegTech) is any technology that enhances and streamlines regulatory and compliance processes. Usually backed by artificial intelligence (AI), it uses data, the cloud and APIs to simplify the end-to-end compliance process – from initial risk analysis and fraud detection right through to auditing.

There are numerous benefits, but for financial service organisations in particular, there are 4 key areas where RegTech can be a game-changer.

1. Risk management

Risk management is key to any business, especially those in heavily regulated industries.

Using powerful AI and machine learning, RegTech solutions can help you detect, mitigate and prevent any number of risks, including non-compliant trades, fraud, market abuse and legal threats.

RegTech can also help you keep abreast of the latest regulatory and compliance updates across jurisdictions and speed up the analysis of changes to help you understand when and how you need to act.

2. Monitoring and auditing

Because RegTech is powered by AI and uses data insights to make recommendations, it allows you to monitor risks and changes in real-time, so you can be confident nothing’s missed and you’re always acting on the latest information.

This automation also makes documentation easier, removing the stress from audit season and giving you confidence that every decision and action has been meticulously captured.

3. Human error and silos

Even the most detail-oriented and focused compliance professional makes mistakes. The sheer volume of threats, regulatory changes, paperwork and data that compliance, legal and finance departments have to manage on a day-to-day basis means that – without support from automation – things can slip through the net.

With RegTech, you reduce the likelihood of human error, which can be costly from both a financial and reputational perspective, especially in regulation-heavy industries.

RegTech can also help break down the natural silos that occur in any organisation. By giving everyone a real-time view of the latest risk information, RegTech makes sure that everyone – no matter their stage or role in the compliance process – is clear on what’s been done so far, what still needs to be done and what information is currently available to do it.

4. Efficiency

RegTech solutions are quick to emphasise their cost- and time-saving benefits, and for good reasons. Increased automation reduces time spent by skilled employees on manual tasks, freeing them up to focus on higher-priority, higher-ROI work.

While the initial effort of onboarding RegTech solutions can initially feel off-putting, it’s important to remember that up-front investment can reap potentially huge long-term rewards.

Future-proof compliance

Investing in RegTech is crucial if you want to transform your compliance approach from reactive firefighting to proactive threat prediction and mitigation.

Get in touch today to see how we can help you on your journey.

See other posts by Colm Dowd

Head of RegTech

Colm has more than 17 years’ experience in Financial Services. A Programme Manager, Financial advisor, Contact Centre Senior leader, Technology and Risk Transformation Expert. Colm also has qualifications in Business, Finance, Project Management and RegTech from IOB, LIT, PMI and Cambridge University. Now leading exciting initiatives in Regulatory Technology at Engage Hub.

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