IS REGTECH POISED TO DISRUPT THE REGULATORY COMPLIANCE ENVIRONMENT?
In the last decade and a half, FinTech (financial technology) has brought about sweeping changes in the banking and financial services industry, using technology to completely transform the way banking and financial transactions are conducted. From standalone brick-and-mortar branch banking, to the age of branchless online and digital banking from the comfort of our homes and at the touch of an app on our smartphones, FinTech has certainly brought about a complete revolution and the ease with which the common man does banking. It is no wonder then that banks worldwide are expected to invest over $20bn in 2017 as technology spend to keep pace with this revolution – the motto clearly is ‘transform or perish’.
While FinTech has transitioned from being a differentiator for banks in terms of superior service to an absolute necessity for even basic survival, RegTech (regulatory technology) has emerged at the threshold of the banking regulatory compliance landscape, with promises of better compliance solutions, reduced compliance cost, higher efficiency and profitability. RegTech may be considered as a subdomain within FinTech, as the former attempts to transform the way regulatory compliance is managed in banks and financial institutions by using advanced technologies, even as the regulatory space continues to be dynamic with new complex rules being enacted and existing ones made more stringent.
In this paper, we try to explore the current challenges in regulatory compliance being faced by banks, and how RegTech can address some of those with emerging technology based initiatives.
Apr-Jun 2017 Issue
Tata Consultancy Services Ltd