The top 6 RegTech trends shaping regulatory compliance in 2025
The RegTech sector has gained significant traction in the financial industry over the past few years, with global adoption accelerating. According to market projections, the RegTech market is expected to hit $25.19bn by 2028, driven by financial institutions’ need to navigate mounting regulatory pressures.
Financial organisations continue to grapple with compliance challenges, often requiring a comprehensive overhaul of legacy systems. High costs, administrative complexities, and evolving criminal typologies underscore the necessity for advanced regulatory technology.
RelyComply, which was featured in the recent RegTech100, has highlighted the six trends it driving the need for regulatory innovation in 2025.
1. Further investment in AI
Artificial intelligence has become a cornerstone of innovation across FinTech, and RegTech is no exception. AI-powered platforms can automate intricate compliance processes and analyse vast datasets in real-time, flagging suspicious activities for AML and countering terrorist financing (CFT). AI’s ability to detect anomalies reduces false positives and manual errors while improving reporting efficiency.
Gartner reports that over half of compliance officers plan to invest in RegTech solutions enhanced by AI next year. With regulations such as the EU’s AI Act ensuring transparency and accountability, scepticism surrounding AI is gradually diminishing.
2. Better understanding of digital assets
The rise of digital currencies has presented both opportunities and regulatory hurdles. Digital assets have been criticised for enabling money laundering and illicit financial flows. However, the World Economic Forum predicts that blockchain-based tokens could comprise 10% of global GDP by 2027.
Governments, including the UK, are now actively regulating digital assets. In 2025, flexible RegTech platforms will play a pivotal role in aligning AML processes with emerging regulations.
3. Putting protection first
RegTech solutions rely heavily on accurate, secure data to function effectively. Regulations such as GDPR and MiFID II mandate transparency and the protection of customer data, reinforcing the need for robust compliance infrastructures.
With rising cyber threats, financial institutions are turning to RegTech for advanced risk management, customer due diligence, and innovative verification techniques. As data protection becomes increasingly critical, RegTech will ensure organisations meet stringent requirements while safeguarding customer trust.
4. Adapting for quick-fire risk in the cloud
Real-time AML monitoring, enabled by RegTech platforms, allows financial institutions to flag high-risk transactions instantly. By adopting risk-based frameworks, companies can improve compliance efficiency and reduce operational costs.
Cloud technology is central to this shift, providing scalable, secure platforms to store and analyse regulatory data. As global regulations evolve, cloud-based RegTech solutions will ensure compliance across diverse jurisdictions while integrating with existing systems.
5. Maintaining sustainability
Environmental, social, and governance (ESG) commitments are increasingly shaping financial institutions’ operations. Non-compliance with ESG regulations can harm an organisation’s reputation and integrity. RegTech solutions help companies monitor, analyse, and report ESG data to meet sustainability targets and regulatory expectations.
6. Cross-referenced expertise and cooperation
Collaboration between financial institutions, RegTech providers, regulators, and governmental bodies is fostering standardised compliance practices. By sharing expertise and resources, organisations can improve AML controls, cybersecurity, and data management.
Public-private partnerships will be essential in 2025 for addressing financial crime. Enhanced interoperability and cooperation, backed by frameworks like the Financial Action Task Force’s Recommendations, will strengthen the global compliance ecosystem.
