8 potential immediate and longer-term benefits of RegTech adoption
The increasing adoption of RegTech solutions is changing the face of Know Your Customer (KYC) processes across industries such as banking, wealth and asset management, professional services and fintech.
This week, Avere Hill, Co-founder and CEO, EMEA of Cynopsis Solution has been speaking at RegFact, an event hosted by FinTech Bay Bahrain under the patronage of the Central Bank of Bahrain, that brings together local and international regulators, and policy advocates to find solutions, and promote best innovative RegTech practices in a collaborative, open and transparent manner.
Here Avere Hill outlines eight potential immediate and longer-term reasons to consider RegTech adoption that he discussed at the event:
Immediate Benefits:
1. Reduced cost of compliance
RegTech can help to drive down the cost of regulatory compliance by streamlining and standardising compliance processes through automated mapping of regulatory risks to key business processes, thereby reducing the need for manual intervention and supplementary checks.
2. Scalable solutions
RegTech utilises sustainable and scalable solutions, allowing for flexibility and growth as business needs change. Firms can move away from rigid enterprise risk management systems once the adopted RegTech solutions are stable.
3. Data analytics
Advanced data analytics allows regulatory information to be studied in various ways, including scenario analytics and scanning the horizon for new regulations, thereby helping firms to pre-emptively identify potential risks and issues.
4. Risk and control convergence
RegTech solutions seamlessly integrated with existing enterprise-wide governance, risk and control platforms, significantly improve the overall governance framework.
Longer Term Benefits:
5. Improved customer experience
RegTech can help to drive improved customer experiences. The use of artificial intelligence and machine learning can provide a robust fraud detection platform that could shorten the transaction life-span, improving the customer experience by reducing the number of false positives.
6. Enhanced market stability
The same technologies that foster growth and promote customer experience can also be used to protect the financial health of institutions and prevent disruption of market agility and integrity.
7. Improved governance
RegTech can provide greater confidence in meeting the board agenda on wider organisational governance, transparency and proactive reporting of risks and compliance.
8. Enhanced regulatory reporting (SupTech – supervisory technology)
An expected application of RegTech will be to meet regulatory-driven data activities and support submissions to authorities. Early adopters can gain a competitive advantage by setting trends and gaining insights.
The author is Co-founder and CEO, EMEA of Cynopsis Solutions, a leading provider of e-KYC solutions. https://www.cynopsis-solutions.com/cynopsis-emea