A survey conducted by regulatory technology business Clausematch has found the RegTech industry has witnessed accelerated growth during the coronavirus pandemic.
The survey – titled Voice of RegTech – was carried out between May 2020 and May 2021 with backing from the UK’s Financial Conduct Authority.
According to Clausematch, a key objective of the study was to gain a better understanding overall of the impact of the Covid-19 pandemic on the RegTech industry. Almost 40 companies from the US, the UK, Australia, Europe, Asia and the Middle East took part in the survey.
Key findings from the survey were that the RegTech industry had seen an uplift in sales during the pandemic, as well as the finding that the attitudes of financial institutions towards technology are evolving rapidly.
Furthermore, the survey suggested that pressure is increasing for regulators to adopt regulatory technology and that in total, 92% of RegTech firms believe that the pandemic has positive impacted the adoption of cloud-based products.
Over 42% of the RegTech businesses that took part in the survey said they saw a sharp rise in sales across the industry over the past half-year. Clausematch believes this is due to changes in working practices throughout the pandemic that have boosted demand for RegTech solutions. Elsewhere, the survey found that that 50% of demand for all new business in the industry is from banks.
In the area of compliance, the most dominant trend identified during the pandemic was the increase in remote compliance. This was highlighted in the fact that 92% of RegTech firms said they had to shift to remote working model during the pandemic, while only 8% said they were partly remote working.
Meanwhile, some survey participants reported that the pandemic has led to a rise in virtual know-your-customer checks and boosted demand for a streamlined process.
In the area of the regulator, 61.5% of respondents said they would like to see the regulator take a more proactive role in the promotion of RegTech solutions. This was compared to 15.4% who wanted to see the regulator take a less active role, and 21.3% of said they would like to see the regulator remain moderate in its efforts in adopting RegTech.
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