Regtech is increasingly innovative and ‘solution orientated’.

Leading firms have developed regulatory change and regtech strategies with clear target-operating models. Deployment can reduce the cost of compliance by 15%–20%. The benefits are clear.

Regtech taxonomy

Effective change frameworks intertwined with a regtech strategy deliver benefits.

Illustration of Effective Change Frameworks and RegTech Strategy Benefits

Regtech-value model

Seven areas have more mature solutions for universal banks, applicability, integration with regulated financial services organisations, and more tangible financial benefits.

1 Horizon-scanning optimisation

2 Regulatory interpretation (digitisation)

3 Regulatory reporting (reg2report)

4 Regulations mapped to policies and controls (reg2controls)

5 Governance risk and compliance tools

6 Financial crime (anti-money laundering/know your business/know your customer)

7 Tax reporting

regtech-sum-of-benefits.png

Cost pressures - regulated firms are under increasing cost pressures to lower the CTB (cost of regulatory change), RTB (1LOD and 2LOD), FTE, and manual effort.

Regtech maturity - regtech firms have matured significantly in the last two-three years: with more innovative products and financial services applicability.

Data models - improvement in data models, and inter-operability and access between regulators, regulated firms, and technology firms (FCA DRR).

Regulators - regulatory burden remains, placing greater emphasis on regulatory reporting, regulatory change, and quality of data (Dear CEO letter). Open banking and open finance are indications of growth.

Regtech 2.0 - regtech will become a competitive advantage for technology savvy compliance and risk departments of the future. Significant utilisation of regtech in 2020-2023.

 

How we help our clients:

We can help design a regtech strategy that accelerates an organisation’s successful adoption of regulatory technology.

The insight we have gained from our own Grant Thornton regtech taxonomy and regtech index places us in the best position to help organisations crystalise their requirements and support them in their selection process of the most suitable technology solution.

We are very well familiar with regulatory expectations and common pitfalls when deploying regtech solutions. Our experience is in supporting firms to deploy regtech’s which result in tangible sustainable benefits. We can help firms navigate through the complexities of customising and integrating regtech solutions.

We develop the target operating model to ensure that the regtech technology software is effectively customised and enabled, optimal user adoption, capability development, governance and underpinning
processes and procedures.

We know when a regtech strategy is working and delivering the desired
outcomes. Our deep experience provides us with the necessary methodology and toolkit to assess the effectiveness of the regtech
solutions that are being implemented.

Report

RegTech and Regulatory Change Report for 2024

What is the current state of the RegTech ecosystem? We look at the critical themes and immediate priorities to be considered in 2024.

    Regtech: automating regulatory change compliance

    The challenge
    Our client wanted to optimise their compliance function: streamlining the horizon-scanning process while also adding value.
    The solution
    We helped them conduct due diligence on their choice of software vendors, acting in an advisory capacity to ensure the final selection would meet their needs. Our team worked with the compliance function to build and analyse the existing regulatory change process – culminating in a visual ‘as-is’ model.
    The result
    The client selected third-party vendors to supply the technology. We used our project management experience to oversee the implementation, working closely with the solution provider to ensure the technical deliverable was implemented correctly and fulfilled the firm’s needs.
    Find out more

    Efficiencies for bank using AI-driven regtech tool

    The challenge
    To improve risk management, an investment bank sought an AI-driven digital solution that could be overseen by humans. It also sought controls for automation that would offer return on investment.
    The solution
    Our team engaged with the bank's risk experts to scope and develop a tool that allowed the bank to identify where risks were being managed effectively – or not – and to find opportunities for efficiencies.
    The result
    Pairing machine efficiency and human expertise built trust with stakeholders, outlined efficiencies, and drew a roadmap for further risk management, control simplification and automation.
    Find out more