KO / EN

Definition

Home

Reg-Tech

Definition

Definition

RegTech (Regulatory Technology) refers to a compound word that entails “regulation” and “technology”, which utilizes latest IT innovation technology (AI, Robotics, Big Data, Cloud Computing, Block Chain, etc) to innovate compliance process.

What is RegTech?

  • The Institute of International Finance(IIF) describes RegTech as "using new technologies to effectively and efficiently address regulatory and compliance requirements."
  • The UK FCA describes RegTech as "a type of fintech technology that focuses on making transmission(application) of regulatory requirements easier and more efficient than traditional tools."
  • Arner, Barberis& Buckley(2017) explained that RegTech utilizes technology for regulatory monitoring, reporting and compliance, especially IT, that is primarily driven by post-crisis regulatory changes, advances in data engineering, efforts to increase efficiency of regulatory and regulatory authorities, and top-down demand from financial companies
  • The European Financial Supervisory Service(ESMA) explained that although there have been cases of technology integration with compliance, recent evolution is different from previous integrations due to the difference between regulatory spikes, data-driven scrutiny, digitalization, and a significant drop in computing and storage costs

"OCTASolution is a pioneer company in RegTech."

RegTech leverages the latest IT technologies such as Artificial Intelligence(AI), Rule, Robotic Process Automation (RPA), Big Data, Cloud Computing, Modular Packaging, and Block Chain to replace compliance tasks in the direction of low-cost, process tailoring by industry, prevention, and automation. RegTech innovates business process, organization and IT response process to respond fluidly with cost reduction, and risk reduction as well as improved productivity by controlling entity’s regulation risk through visualization. This is a technology that protects customers, secures market health, and ultimately protects financial institutions and their business models by cost-effectively responding to punitive fines and regulations.

FCA's investigation result on RegTech development/adoption

FCA, a British financial conduct authorities (supervisory organization), proposed improvement on information sharing methods, standardization of data formats, upgrade of large data storage with analysis, and the development of a dashboard for risks visualization.

Eventually, reporting itself needs to be automated as system to system, leverage Cloud technology to deliver compliance solutions as a SaaS service, implement proactive surveillance through artificial intelligence and big data analytics, and ultimately, implement a dashboard to monitor financial company-wide operational risk/compliance