Far greater numbers of firms are taking positive steps toward realizing the potential benefits of fintech and regtech. While skill sets continue to grow rapidly to keep pace with developments in fintech, however, there is widespread awareness of the need for training and skills in all aspects of fintech and regtech digital innovation and disruption, as access to the relevant skill sets may become a significant differentiating factor. But the budget available for regtech continues to vary widely, according to Thomson Reuters Regulatory Intelligence.
Thomson Reuters has undertaken its second global survey to assess the impact of developments in regtech and fintech on the role and remit of the compliance function in financial services firms. Compliance and risk practitioners from nearly 800 financial services firms across the world took part. The findings are intended to help regulated firms with planning, resourcing and direction, and to allow them to benchmark whether their resources, skills, strategy and expectations are in line with those of the wider industry.
[For more from the report’s authors on the results of the survey, view “Fintech, Regtech and the Role of Compliance in 2017: Attitudes, Opportunities and Challenges” and “Fintech, Regtech and the Role of Compliance in 2017, Part 2: A Balance Between Innovation and Stability.”]
Firms are warming up to the potential benefits of fintech and regtech. There has been a marked positive shift of respondents who view fintech and regtech innovation and digital disruption in a favorable light. In overall terms for 2017, 83 percent of respondents had a favorable opinion of fintech (including insurtech), innovation and digital disruption, with 27 percent reporting an extremely positive view. This is almost double the 2016 results, where 42 percent reported a positive view (18 percent extremely positive).
In parallel, there was a significant increase in the favorable opinion of regtech innovation and digital disruption, with 75 percent of respondents reporting a positive view (26 percent extremely positive). This was in distinct contrast to the 40 percent who reported a positive view in 2016 (15 percent extremely positive).
There were myriad expected potential benefits from fintech. Improved efficiency and productivity was seen as the largest potential benefit, with successful deployment of fintech and regtech enabling, among other things, more time to focus on value-added compliance activities. Other prominent potential benefits included greater commercial opportunities and advancing technology and better IT systems. Of particular interest to the compliance function is the capacity to implement and embed better compliance practices together with improved customer outcomes.
The expected benefits have contributed to the vast majority (93 percent) seeking to develop regtech solutions.