In a recent innovative and fascinating marketing piece, Ashurst, the top lawyer, has coined the term ‘Regtech’ to its clients. ‘Regtech’ is the digital byproduct of Fintech and regulation. So what is the likely impact on financial services firms? FLOvate partner and Compliance expert Stephen Cooper comments.
Fintech – it’s a term that many of us hear nowadays. But what does it mean? For me, it is a new market offering disruptive technology, products and services, replacing old-style structures with new technology-driven processes.
These products and services are likely to incur some R&D costs, but are likely to be less costly over time than traditional IT solutions as they do not rely on expensive infrastructure.
It is likely that firms will remodel their back office functions to create more automated processes to drive greater efficiency and quality control in their business.
According to lawyer Ashurst, global investment in Fintech was over US$12 billion in 2014. Moreover, the UK Government has estimated that over £20 billion of revenue was generated by Fintech related businesses in 2014. For example, technologies/ crypto-currencies for digital cash; use of big data in fraud reduction, etc.
Fintech – what’s the challenge?
Fintech is impeded by established UK and EU regulatory framework which does not work at the same speed. Regtech might be described generally as the required “digital element” that results from the friction between existing and planned immovable and inflexible regulation and Fintech.
Workflow IT solutions can be part of both and will help firms bridge the gap between Fintech and Regtech by recognising and accommodating the top down demands of both with bottom up solutions.
Workflow is also disruptive technology as it is component based and constructed, cost effective, flexible, client scoped and controlled both top down and bottom up in a world where pressure is always to do more and better with less.
To learn more about how I’m helping financial services firms ‘bridge the gap’, do get in touch via my website: hannafordassociates.com