DEVELOPMENTS IN REGTECH
RC: In broad terms, what do you consider to be the most significant developments to have taken place in the regulatory technology (RegTech) space over the past 12 months or so?
Gafke: There have been a number of significant developments affecting RegTech. First, the explosion of FinTech has helped large financial institutions as well as brand new firms. They, in turn, provide greater access to financial services, especially to the underserved. Second, there has been an acceptance that tech can solve regulatory issues, not just fraud but traditional back-office regulatory concerns for start-ups as well as large financial institutions. Third, automation has become a driver of compliance efficiencies, with small firms scrambling to automate so they can scale efficiently and large firms automating to become better. Finally, the use of a tremendous amount of Big Data is helping to prevent and detect fraud, money laundering and financing of terrorism.
RC: What are some of the common issues facing businesses that RegTech seeks to address?
Gafke: Companies are grappling with how to automate existing processes and procedures. With so much data available and the ability to process and analyse complex data scenarios in real-time, businesses must determine how to operationalise the data so it can better inform their processes. Companies are also trying to figure out how to make use of the data available. Traditional financial organisations tend to function in silos, with the compliance team separate from the risk team and so on. A common data taxonomy allows different groups to use and share data across the organisation.
Oct-Dec 2016 Issue