CXOToday has engaged in an exclusive interview with Aruna Pannala, Partner, Deloitte India.
- How will RegTech impact the FinTech sector?
FinTech may be described as the solutions used by the business functions, whereas RegTech refers to the solutions used by the second line of defense. FinTech is going through a period of swift growth and this new phase brings new difficulties for regulators, which requires the simultaneous adoption of RegTech solutions. Regulated entities must use innovation to develop and integrate RegTech solutions into their existing FinTech architecture.
- How can CIOs, CISOs apply RegTech in their organizations?
RegTech solutions enhance the ability of regulated entities to operate efficiently and adhere to regulatory requirements. Technological advancements are creating significant opportunities to implement RegTech solutions spanning several application areas, including capital management, cyber security, risk management, operations, and regulatory reporting, amongst others. RegTech solutions help address the risks associated with cyber threats, network security, breach of sensitive customer information and business processes, that can lead to business disruption and vulnerability.
- How will RegTech ensure compliance within the regulatory landscape?
Regulatory compliance lies at the core of the issues that RegTech seeks to address. The three components of regulatory compliance in the Indian context are inventory of regulatory obligations, identity management, and regulatory reporting to ensure compliance within the regulatory landscape.
- To keep track of regulations, RegTech solutions offer inventories and translate regulatory requirements into specific actionables and automate the compliance lifecycle into daily workflows. Regulatory horizon scanning tools are designed to track, identify, and monitor regulatory trends and changing regulations.
- Identity management and KYC solutions help determine the “true” identity and background of customers to protect regulated entities against financial crimes. These solutions are industry agnostic and are at present in use in the financial, telecom, and consumer goods sectors.
- Regulatory reporting solutions simplify the report generation process by standardising data requirements, streamlining data flow from various data sources, and enabling validation checks and controls. Reports may be automated through preconfigured data models, which may be accessed through user interfaces and with the limited involvement of IT specialists.
- Why RegTech is a global need?
With an increase in the number of regulatory initiatives to promote RegTech and regulated entities expressing interest in deploying such technologies, the RegTech market has witnessed significant growth. RegTech solutions augment stability and efficiency in operations and provide flexibility to develop capabilities to drive this growth. Regulators are taking a proactive stance to educate the financial services industry on the role of regulatory technology, to improve efficiency and ease of regulatory compliance and risk management. This paradigm shift towards RegTech serves to benefit both regulators and regulated entities. Globally, financial services regulators have adopted a variety of initiatives to raise awareness of RegTech developments, its benefits, and accelerate adoption within the industry.
