The financial crisis of 2008 changed the Banking, Financial Services, and Insurance (BFSI) industry forever, sowing the seed for massive regulatory renovation and increased compliance costs. The worldwide investment in RegTech has more than tripled over the last five years, with RegTech companies automating complex compliance processes and streamlining regulatory reporting to decrease compliance costs.
In the UK alone, a 2019 study by McKinsey and Company revealed that regulatory reporting by UK banks costs them anywhere from 2 billion to 4.5 billion pounds per year. Another source indicated that around 10-15% of staff in financial institutions work on governance, risk management and compliance. You can download our whitepaper on data collection transformation in the UK here.
The supervisory perspective has changed as well, with regulators becoming increasingly focused on robust data collection. Since 2008, regulators have imposed more than USD 300 billion in fines and penalties on firms that have failed to achieve regulatory compliance standards. Even recently, the Bank of England has been actively imposing whopping fines for non-compliance, such as 46 million pound fine for Standard Chartered Bank.
Companies are actively pursuing the adoption of RegTech solutions not just in fear of non-compliance penalties, but also to reduce costs and time spent on regulatory compliance. If we can get into a self-driving car, can we make compliance more self-driving as well? With the right solutions, definitely.
More details on the reporting framework releases is available at the EBA’s official website.
Using technology means to streamline reporting processes in regulatory compliance continues to evolve at a rapid pace, as demonstrated in the report “RegTech Market- Global Forecast to 2025”. Others indicate that in 2020 alone, there were 1300 regulatory changes worldwide, largely influencing areas of compliance and risk management. Overall, the RegTech market is expected to reach 16.0 billion USD by 2025, with a CAGR of 20.3% between 2020 and 2025.
You might ask, is technology really a new fab in regulatory compliance? The answer is no, it’s not. But the COVID-19 crisis has definitely led to an increased focus on maximum cost and time effectiveness of compliance processes, and is there any better way to achieve this than with technology?
An excerpt from the “RegTech Market Global Forecast to 2025”:
“Using technology means to streamline reporting processes in regulatory compliance continues to evolve at a rapid pace, as demonstrated in the report “RegTech Market- Global Forecast to 2025”. Others indicate that in 2020 alone, there were 1300 regulatory changes worldwide, largely influencing areas of compliance and risk management. Overall, the RegTech market is expected to reach 16.0 billion USD by 2025, with a CAGR of 20.3% between 2020 and 2025.
You might ask, is technology really a new fab in regulatory compliance? The answer is no, it’s not. But the COVID-19 crisis has definitely led to an increased focus on maximum cost and time effectiveness of compliance processes, and is there any better way to achieve this than with technology?”
Source: RegTech Market Global Forecast 2025, marketsandmarkets.
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