Regulatory technology or regtech is starting to play a crucial role in ensuring digital transformation projects are not only successful, but fully compliant too.
Andrea Tucker, Head of Research & Development and Strategic Projects at e4, notes that while regtech, defined as the management of regulatory processes within the financial industry through technology, is relatively new it looks set to make a significant impact on how financial institutions tackle digital transformation.
“At its simplest, regtech makes the process of complying with regulations like FICA, POPIA, and the like completely seamless. A practical example of the power of regtech in action is e4’s role in enabling a fully digital credit card application process for a major South African bank within just four months,” says Tucker.
Regtech is proving to be critical in mainstream banking as these organisations accelerate their digital transformation journeys thanks to the convergence of renewed consumer demand for paperless services and the Covid-19 pandemic making the virtual switch a clear necessity. “Regulations, consumer trends, and technology are constantly evolving which makes for a truly dynamic environment for the banking and financial services industries. It’s also an environment which requires continuous attention to change and how new regulations, particularly those concerning digital interactions with end consumers, affect organisations and their compliance requirements,” adds Tucker.
She says regtech ensures that the onboarding process can be entirely virtual while still meeting organisational rules and standards together with wider legal requirements. “Another important benefit of regtech is that it makes it possible for interactions with organisations to become far more cost effective, more streamlined, and less onerous for the end consumer.”
In addition to streamlining any consumer facing process that also needs to be reported on, Tucker says regtech can give organisations an edge in several other ways too. “Not only are shifting demographics moving towards frictionless exchanges, both small and large financial services organisations can benefit from implementing regtech as it frees skilled staff from tedious manual paperwork to work on more fulfilling tasks.”
For organisations who haven’t yet considered regtech as part of their wider digital transformation journey, Tucker recommends starting off by getting a good handle on existing business rules and processes. “A full understanding of all internal procedures is the foundation on which wider compliance and meaningful digital transformation is built.”
){kind=link}
