{"id":10720,"date":"2024-05-07T16:02:56","date_gmt":"2024-05-07T16:02:56","guid":{"rendered":"https:\/\/fintech.global\/fincrime50\/?p=10720"},"modified":"2024-05-07T16:03:44","modified_gmt":"2024-05-07T16:03:44","slug":"why-banks-are-increasing-their-regtech-spend-year-on-year","status":"publish","type":"post","link":"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/","title":{"rendered":"Why banks are increasing their RegTech spend year-on-year"},"content":{"rendered":"

As technology continues to expand its reach within the financial services market, many banks are looking over their shoulder at the vast litany of risks that a tech-dominated market includes. With this in mind, many firms are looking at a technology to help them in this fight \u2013 RegTech.<\/strong><\/p>\n

With financial crime continuing to become more commonplace and robust within the financial market, spending is rising on RegTech solutions at banks. In the view of Remonda Remonda Kirketerp-M\u00f8ller, CEO at\u00a0Muinmos<\/a>, this trend is being driven by several compelling forces.<\/p>\n

She explained,\u00a0\u201cThe rise in global regulatory complexity, coupled with the increasing costs of compliance and non-compliance alike, has necessitated a more robust technological approach to regulatory challenges. Banks are leveraging RegTech to streamline compliance processes, reduce errors, and enhance reporting accuracy, ultimately aiming to turn the cumbersome obligation of compliance into a more manageable and efficient operation.\u201d<\/span><\/p>\n

Furthermore, this escalation in investment in RegTech is backed by the recognition\u00a0that traditional manual compliance processes are no longer sustainable in rapidly changing regulations and the growing demands of data management and analysis, states the Muinmos CEO.<\/span><\/p>\n

\u201cIn addition, the financial penalties for regulatory breaches have become more severe, making the cost of non-compliance significantly higher than investing in preventative technology,\u201d she added.<\/span><\/p>\n

Overall, the trajectory for spending on RegTech solutions appears, in Kirketerp-M\u00f8ller\u2019s view, to remain on an upward path. \u201c<\/span>As regulatory demands continue to evolve, particularly in areas like AML, KYC, and the broader landscape of financial crime, banks are expected to further increase their reliance on Regtech solutions.<\/span><\/p>\n

\u201cThis investment is not only a response to regulatory pressures but also a strategic move to gain competitive advantage through operational efficiency and resilience. Therefore, the momentum behind RegTech spending is not just a reaction to past and present challenges but a forward-looking approach to future-proofing banks against an increasingly complex regulatory horizon,\u201d she stated.\u00a0<\/span><\/p>\n

Superior technology<\/strong><\/p>\n

Anthony Quinn, CEO of Australian RegTech firm\u00a0Arctic Intelligence<\/a>, believes that many \u2018forward-thinking\u2019 companies are starting to realise the limitations of using Excel spreadsheets, and due to this, are transitioning to RegTech solutions.<\/p>\n

He underlined, \u201cMost banks we encounter have been relying on spreadsheets to conduct complex risk and control assessments for years, if not decades, and this under investment in systems in this area is an area that they should be investing in as it is inconceivable that a bank or other major corporates could properly manage their financial crime risk assessments on primitive spreadsheets that have been in place for years when RegTech solutions like those we offer at Arctic Intelligence are light years ahead.\u201d<\/p>\n

Quinn stressed that if such organisations are not considering boosting spend on RegTech, given its proven time and cost savings compared to traditional methods, then something is wrong, as the solutions are \u2018far superior\u2019.<\/p>\n

\u201cThese technologies are being heavily invested in and improving over time so the gap between manual approaches and technology-given approaches is widening, and considering the consequences for non-compliance could stretch into the billions it would be very penny-wise and pound-foolish for banks to cling on to outdated practices for much longer,\u201d concluded Quinn.<\/p>\n

In a similar vein, Sean Devine, business development manager at\u00a0ViClarity<\/a>, remarked that it is \u2018certainly evident\u2019 that banks have boosted their RegTech spend in the last several years.<\/p>\n

He stated, \u201cNumerous causes are behind this trend such as the retirement of unsustainable traditional methods, newly imposed and revised regulation such as enhanced fitness and probity by the CBI and introduction of Consumer Duty by the FCA as well as compliance failures that have resulted in significant financial penalties for banks imposed by the regulator.\u201d
\n<\/i><\/p>\n

With this in mind, Devine believes future RegTech spending trends are likely going to go in the same direction. \u201cWith new regulations being implemented and old ones being revised, the regulatory landscape is always changing.<\/p>\n

\u201cThe use of RegTech solutions to address changing compliance requirements will be accelerated by technological developments like blockchain and artificial intelligence,\u201d he said.<\/p>\n

Meanwhile, Freddie<\/span>\u00a0Frith<\/span>, Head of Sales at\u00a0Corlytics<\/a>\u00a0added, \u201cOver the past few years, banks have been significantly increasing their investment in RegTech moving from pilot experiments led by innovation teams to formalizing budgets within larger compliance transformation programs.<\/p>\n

\n

\u201cThis shift is driven by both internal needs and external pressures. Internally, there\u2019s a strong push for digitization and automation to streamline cumbersome and costly manual administrative tasks. Organizations are keen on finding more efficient ways to allocate their funds while aiming to reduce full-time equivalent (FTE) staffing requirements.<\/p>\n<\/div>\n

\n

\u201cExternally, the complexity of global regulations is on the rise. Enforcement actions are becoming more localized, and new regulatory frameworks are holding executives directly accountable for the compliance levels within their businesses. This evolving regulatory landscape necessitates a robust investment in RegTech solutions to ensure compliance and mitigate risks,\u201d Frith concluded.<\/p>\n<\/div>\n","protected":false},"excerpt":{"rendered":"

As technology continues to expand its reach within the financial services market, many banks are looking over their shoulder at the vast litany of risks that a tech-dominated market includes. With this in mind, many firms are looking at a technology to help them in this fight \u2013 RegTech. With financial crime continuing to become […]<\/p>\n","protected":false},"author":4,"featured_media":10723,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":[],"categories":[1],"tags":[],"yoast_head":"\nWhy banks are increasing their RegTech spend year-on-year - FinCrimeTech50<\/title>\n<meta name=\"description\" content=\"As technology continues to expand its reach within the financial services market, many banks are looking over their shoulder at the vast litany of risks\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Why banks are increasing their RegTech spend year-on-year - FinCrimeTech50\" \/>\n<meta property=\"og:description\" content=\"As technology continues to expand its reach within the financial services market, many banks are looking over their shoulder at the vast litany of risks\" \/>\n<meta property=\"og:url\" content=\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\" \/>\n<meta property=\"og:site_name\" content=\"FinCrimeTech50\" \/>\n<meta property=\"article:publisher\" content=\"https:\/\/www.facebook.com\/GetGlobal.Fintech\/\" \/>\n<meta property=\"article:published_time\" content=\"2024-05-07T16:02:56+00:00\" \/>\n<meta property=\"article:modified_time\" content=\"2024-05-07T16:03:44+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/fintech.global\/fincrime50\/wp-content\/uploads\/2024\/05\/marvin-meyer-SYTO3xs06fU-unsplash-1-1-scaled-e1715097810299.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"2560\" \/>\n\t<meta property=\"og:image:height\" content=\"1363\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"editorial\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:creator\" content=\"@Fintech_Global\" \/>\n<meta name=\"twitter:site\" content=\"@Fintech_Global\" \/>\n<meta name=\"twitter:label1\" content=\"Written by\" \/>\n\t<meta name=\"twitter:data1\" content=\"editorial\" \/>\n\t<meta name=\"twitter:label2\" content=\"Est. reading time\" \/>\n\t<meta name=\"twitter:data2\" content=\"4 minutes\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"Article\",\"@id\":\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/#article\",\"isPartOf\":{\"@id\":\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\"},\"author\":{\"name\":\"editorial\",\"@id\":\"https:\/\/fintech.global\/fincrime50\/#\/schema\/person\/700e93a9f1ec1d00f1b7baf07636829d\"},\"headline\":\"Why banks are increasing their RegTech spend year-on-year\",\"datePublished\":\"2024-05-07T16:02:56+00:00\",\"dateModified\":\"2024-05-07T16:03:44+00:00\",\"mainEntityOfPage\":{\"@id\":\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\"},\"wordCount\":814,\"publisher\":{\"@id\":\"https:\/\/fintech.global\/fincrime50\/#organization\"},\"inLanguage\":\"en-US\"},{\"@type\":\"WebPage\",\"@id\":\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\",\"url\":\"https:\/\/fintech.global\/fincrime50\/why-banks-are-increasing-their-regtech-spend-year-on-year\/\",\"name\":\"Why banks are increasing their RegTech spend year-on-year - 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