RegTech is entirely new to most people as only few have an idea of what RegTech is all about. A reasonable number of people are familiar with FinTech, so if you’re on this boat, RegTech shares same idea with FinTech.
What is RegTech?RegTech in full means Regulatory Technology. The reliance on consumer data to produce digital products has lead to concerns among regulatory bodies calling for more laws on data privacy usage and distribution.The coupling of more regulatory measures and laws with a sector more reliant on technology brought about the need for regulatory technology. One can have a simple definition of RegTech as the management regulatory processes within the financial industry through technology. As technology continues to break through all sectors, its grip on the financial sector has led to FinTech, RegTech and lots more. Since RegTech has lot to do with the use of new technology to facilitates the delivery of regulatory requirements, various companies have keyed into its idea.
RegTech CompaniesRegTech companies like Trunomi, Suade, Pass fort and so on, collaborates with financial institutions and regulatory bodies, using cloud computing and big data to share information. Yeah, ‘cloud computing’ might be strange to some people as it is no surprise. Cloud computing is a low-cost technology wherein users can share data quickly and securely with other entities.
Functions of RegTech CompaniesRegTech consisting of groups of companies that uses cloud computing technology through software-as-a service (saas) to help business comply with regulations efficiently and less expensively has the following functions;
- RegTech provides an easy to integrate, reliable, configurable, cost-effective and secure regulatory solutions to facilitate the delivery of regulatory requirements.
- Provide anti-fraud and risk management services for digital transactions by tracking payment entities.
- Help banks submit required regulatory reports without disruption to the architecture.
- Connects asset managers and insurers through a fund data utility to meet solvency ii requirement.
- Securely manages the consent to use customer personal data.
- Automates the collection of storage of customer due to diligence data.
- Oversees how data is managed and processed by the fund industry.
- Regulatory monitoring, reporting and compliance.
Top six (6) RegTech CompaniesAs level of regulation rise and focus on data and reporting increases, that has also led to the rise of many RegTech companies. Below is a list of top six (6) RegTech companies;
- Identity and Global
- Silver finch
- Pass fort
- Fund Recs
Who uses RegTech? Why the need of RegTech? What problems does RegTech solve?Solutions to problems over the years have been the chief drive to technological development. RegTech using various RegTools, monitors transactions that takes place online in real time, to identify issues or irregularities in the digital payment sphere. And if any outline is spotted or identified, it is relayed to the financial institution to analyze and determine if a fraudulent activity is taking place. RegTech solves challenge arising from technology driven economy through automation. As digital products has continue to rise, its negative effect too has taken same move, leading to an increase in data breaches, money laundering, cyber hacks and other fraudulent activities only the ideas behind RegTech can have a check on.
Uniqueness of RegTech Firms/Companies
- A RegTech company creates analytic tools for banks to successfully comply with a regulatory body, saving the bank time and money.
- RegTech can quickly separate and organize cluttered data set through extract and transfer load technology.
- A RegTechh firm can combine complex information from a bank with data from previous regulatory failures to predict potential risk areas that the bank should focus on.
- RegTech generates reports quickly.
- RegTech can integrate purpose to get solutions running in a short amount of time.
- RegTech mine big data sets, to be further used for different purposes.
Automated Projects of RegTechRegTech automates the following projects through its application;
- Audit trail
- Fraud prevention
- Compliance data management
- Employee surveillance