Taina Technology recently highlighted what it believed were seven key trends within the RegTech industry in 2023.
1. The Growing Interest in AI, Especially Gen AI
The advancements in computer science, particularly in AI, are opening new avenues for exploration. Large institutions and RegTech companies, including TAINA, are heavily investing in AI applications. A notable trend is the burgeoning interest in Gen AI, sparking significant investments in this area.
2. Cautious Implementation of Gen AI
Despite the enthusiasm for Gen AI, its implementation within regulated financial institutions is marked by caution. The risk of Gen AI generating seemingly accurate but potentially misleading responses necessitates a careful approach. TAINA is actively engaged in this space, balancing AI’s cost-saving potential with a commitment to human interaction and relationship building.
3. Enhanced Focus on FinCrime Amid Political Turmoil
The ongoing crisis in Ukraine has heightened the focus on FinCrime, particularly concerning sanction breaches. TAINA remains dedicated to identifying and preventing potential sanction violations, a priority in the current macro-political climate.
4. Evolving Skillsets of Compliance Managers
The role of compliance managers is evolving, with an increasing need for expertise in selecting and implementing RegTech solutions. This trend is expected to continue as these professionals collaborate more closely with technology vendors to meet their institutions’ evolving requirements.
5. Sophisticated RegTech Selection by Financial Institutions
Financial institutions are becoming more astute in selecting RegTech solutions. The shift from ‘build vs buy’ to a more nuanced selection process is enabling faster, more confident decision-making. Innovation Labs within these institutions play a crucial role in this evolution, allowing for rapid testing and decision-making.
6. Demand for Plug and Play Solutions Due to Cost Pressures
In response to rising cost pressures, financial institutions are prioritizing ‘Plug and Play’ solutions for their simplicity and ease of maintenance. TAINA has responded by developing offerings that cater specifically to this need.
7. Collaborative Success Stories in the Industry
A new culture of collaboration is emerging in the industry, evidenced by the successful partnerships between large financial institutions and young RegTech providers. These collaborations have yielded high ROI and are contributing to a more unified industry direction.
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