Maintaining rules and regulations and being up-to-date with the new ones is an important part of every company’s success.
There are many ways a company can perform the above tasks, but some methods cost more than others, which every company cannot afford.
This is where Regtech comes into play.
What is RegTech?
RegTech refers to the technologies and software created to overcome a company’s regulatory challenges and maintain them throughout.
Regulatory challenges refer to the laws, guidelines, and regulations that a company should follow to avoid a legal fine or punishment.
RegTech uses the latest technologies to ensure that the company keeps up with the new laws. takes control of places that actively mitigate risk and help companies understand regulatory requirements and stay compliant.
Using advanced technologies like Artificial Intelligence (AI), Machine Learning (ML), Internet of Things (IoT), and Blockchain, RegTech manages several tasks, such as risk management, data reporting, and transmissions, among others.
According to MARKETS AND MARKETS, the RegTech market size is expected to grow from USD 6.3 billion in 2020 to USD 16.0 billion by 2025, at a Compound Annual Growth Rate (CAGR) of 20.3%.
How does RegTech work?
RegTech follows a four-step process to maintain regulatory compliance, which is:
Step 1 – Customer onboarding:
This step involves the registration of customers and verifying their documents. A deep check of the customer’s identity, assets, and finances is done to avoid fraud and threats. Furthermore, the submitted documents are checked for compliance requirements.
Step 2 – Monitoring:
Continuous watch on the customer’s activities is kept by using monitoring software to ensure that the activities remain under the company’s regulatory compliance. RegTech uses advanced technologies like Big Data and Cloud Computing to maintain data of customers’ activities.
Step 3 – Detection:
By keeping track of customer activities, RegTech detects suspicious activities. It uses Machine Learning to look out for such repetitive suspicious activities to avoid fraud, risks, and money laundering.
Step 4 – Reporting:
If a customer’s actions don’t fall under the company’s rules and regulations, this step is taken. Once the activity is identified, RegTech reports the activity to the company which leads to customer service termination, hence the risk is managed.
Need for Custom RegTech Software for Your Business
Changes in the rules, laws, and regulations are frequent and sometimes it’s hard for companies to keep up with them. This is where RegTech comes in.
Let’s learn more about the need for custom RegTech software solutions for your company:
RegTech for work efficiency:
With the help of RegTech, companies can automate the compliance process which would lead to work efficiency and improved performance.
RegTech for risk management:
RegTech, with the help of advanced technologies like Artificial Intelligence and Machine Learning, keeps track of customers’ activities and reports any suspicious activity to the company. This helps the company detect fraud at an early stage and take necessary actions to terminate the risk.
RegTech for saving cost:
Hiring a whole team to update the regulatory compliance changes is both costly and time-consuming. However having a custom RegTech software solution that performs better and costs less is a much better option.
RegTech singlehandedly performs a lot of functions, such as consumer registration, document verification, and customer activities monitoring, among others. Tasks like these require a lot of manual effort, and RegTech solutions take off that burden.
RegTech for data collection:
As companies continue to collect huge volumes of data to improve digital customer experience and manage risk and compliance, it’s better to automate the whole process. RegTech automates the processing and collection of data and mitigates inherent risks associated with data security.
Key features of RegTech software
Thinking of developing custom RegTech software for your company?
Here are some features you should be looking for:
- Speed: RegTech software should be able to configure and generate reports in no time. Having fast processing software would lead to faster fraud detection, thus lowering the risk rate.
- Adaption: RegTech software should be able to understand the new regulatory process and quickly adapt to changing regulations.
- Data Transfer: RegTech software should use technologies that extract, transfer, and load complex data and turn them into ready-to-use information.
- Integrations: RegTech software should be able to do easy customization and integration with various third-party tools to make a product suitable for various institutions.
By now you must have a clear understanding of RegTech and its importance. If you are looking for a custom RegTech software development partner, Jellyfish Technologies might be the right choice.
Jellyfish Technologies customizes its services according to the client’s requirements and delivers end-to-end solutions or individual features. JFT TEAM can develop products of any complexity from scratch or contribute to an ongoing project.
