Tuesday, September 13th 2016, marked the start of the RegTech Summit in London, a highly anticipated user-driven conference centered on regulatory compliance and the vital role that new technologies are playing in the financial services industry. I was on hand for the proceedings this morning, and from the get-go the need for these technological innovations was made apparent. The ability to make compliance more cost-effective, easier to manage, and more reliable was at the forefront of the discussion, and with a real interest being shown by regulators to work with institutions to adopt regulatory technology in order to better understand and manage risks.
With prominent officials representing some of the more notable financial institutions worldwide on hand, the general theme of the conference was explained concisely early on by Laura Warner, Chief Compliance Officer of Credit Suisse, when she declared, “You can wait for the trends in technology to come to you or you can work to set the trends”, a truly resounding statement representing the need for adaptation in this industry. Ruth Wandhöfer, the Global Head of Regulatory & Market Strategy for Citi Transaction Services, delivered another shrewd statement shortly after, regarding how it is paramount for banks to change their business model(s) to address compliance. Wandhöfer asserted, ”Departments need to become de-silo’d so that technology and traditional banking merge.” That being said, RegTech has the ability to alter the relationship between traditional banking systems and their compliance obligations through the use of technology that diminishes the burden placed on humans to make intelligent assessments.
As this tech space is quickly filling with solutions providers, I would provide a word of caution to all tech companies offering their solution as the magic pill to assist organizations fulfill their regulatory requirements. Seasoned professionals dealing with compliance challenges will be quick to spot those with little experience.
