The pandemic created challenges for both large- and small-scale businesses- Risk management being one of them. While this virus’s health impacts subside in the days to come, the financial and reputational implications amongst the financial firms will be in existence for many years.
Economic shudder has led investors to lose money, which brings forth the urge to create a risk management program that manages current and evolving risks. In this context, Regtech may act as a catalyst.
Regtech is becoming a commonplace as regulators embark on digital transformations for compliance and risk management. This tech-driven concept manages regulatory processes within the finance domain through technology. The significant functions covered here are compliance, monitoring, and reporting.
Adapting to the new normal
Regtech plays a significant role in ensuring that every operational aspect of financial institutions remains legal and regulated. The technologically advanced solutions offered by Regtech promises to provide solutions in areas like risk management, identity management, compliance, regulatory reporting, and so on.
Enabled by RegTech, banks are implementing automated customer onboarding to solve long-standing problems by onboarding customers remotely. Automated repetitive tasks like data entry and verification increase employee efficiency to focus on building strategies to navigate the pandemic.
On the other hand, AI can help optimize the processing of regulations, and the actions they require, assisting firms to stay up to date. AI in RegTech can help accelerate compliance practices by providing quick document review, greater contextual insights, and deeper fraud prevention measures. In short, AI leads to a valuable and efficient compliance function.
Similarly, technology progression has led to data breaches, anti-money laundering, cyber hacks, and many other fraudulent activities. And Regtech solutions are a must to deal with such inadequacies effectively.
