The RegTech Association launches new RegTech/SupTech report showing strong growth and movement into new verticals
The RegTech Association (RTA) today released their annual Industry Perspectives Report. This report is the result of a global survey to institutions, regulators, financial authorities, consultants and RegTech/SupTech firms. Data analytics for the report was provided by Deloitte.
Deborah Young, CEO of the RTA said:
“We take pride in this global annual data initiative, which provides contemporary, market-driven insights while driving actionable outcomes to benefit the broader RegTech and SupTech ecosystem. By developing strategies and actions from this research, we can more effectively address the challenges faced by each stakeholder group while creating opportunities for RTA members.
The RegTech industry continues to mature, showing another year of strong growth. For the second year, data reveals that customer expectations remain the primary driver for RegTech adoption. The report also shows regulators continue to be highly engaged, while Fraud and Scams have entered the top five risks addressed by RegTech, reinforcing what we have anecdotally known for some time. Additionally, new sectors such as healthcare and telecommunications are beginning to recognise the advantages of RegTech.
Our next steps as a global association include a focus on AI, specifically Generative AI applications for RegTech and SupTech. We aim to collaborate globally to highlight the role of innovative technology in reducing risks related to Fraud and Scams. This includes working with global institutions to showcase solutions that reduce this burden enabling them to focus on serving their customers. We will also partner with regulatory agencies to ensure that financial systems remain stable while keeping pace with the latest technology.
I’d like to thank and acknowledge the team from Deloitte for their support of this important initiative.”
Sweta Maira, Partner at Deloitte, Data & Digital, Audit & Assurance said:
“Regulatory pressure, customer expectations and organisational efficiency continue to be significant drivers for RegTech adoption.
Over 73% of respondents believe that Generative AI will substantially transform the industry within the next one to two years, particularly in areas like Regulatory Compliance and AML/CTF/Sanctions.
With continued innovation and a focus on addressing key challenges, the industry is well-positioned for growth in the coming years.”
Key highlights from the report include:
Regulatory Engagement: Regulators remain highly engaged with a strong appetite for RegTech/SupTech solutions.
Key Drivers for Adoption: Customer expectations and regulatory pressure are significant motivators for adopting RegTech solutions.
Time to Value: The average time from initial conversation to full deployment has stabilized at 8.1 months.
Top Risks Addressed by RegTech: Regulatory Compliance, Compliance, AML/CTF/Sanctions, Operational, and Fraud and Scams.
Top Adopting Sectors: Finance, Insurance and Superannuation, Government Administration, Healthcare, and Telco
Revenue Growth: Most RegTech companies expect strong revenue growth, with 26% anticipating over 30% growth.
Funding Environment: Private equity investment is up, while bootstrapping and angel investment have decreased.
Technology Trends and Solutions
Generative AI: Expected to substantially transform the RegTech industry within the next 1-2 years, particularly in Regulatory Compliance and AML/CTF/Sanctions.
Adoption of AI: 67% of organizations are using Generative AI, with significant adoption of Machine Learning (62%) and Natural Language Processing (50%).
Next Steps for The RegTech Association
The report provides data-backed evidence and emphasises the need for priority and focus for the RTA going into 2025.
Safe and explainable Generative AI applications
Focus by institutions and regulators on customer and consumer outcomes
The need to protect the system and wider community from fraud and scams
Enhanced collaboration across the wider eco-system on the use cases and benefits of RegTech and SupTech adoption
About The RegTech Association:
With a clear vision to be a global centre of excellence by facilitating the building of higher performing, ethical and compliant businesses through RegTech innovation and investment, The RegTech Association was founded in 2017 as a non-profit organisation that focuses on what is needed to support the growth of the sector and to accelerate RegTech adoption. We support our members to embrace and adopt best practice Environmental, Social and Governance principles.
The association brings together government, regulators, regulated entities, professional services and founder-led RegTech companies to ensure collaboration between all of the parties, promoting the RegTech industry as widely as possible, resulting in action in the uptake of RegTech proof of concepts and deployed RegTech solutions across the eco-system.
