Five RegTech firms making an impact on the enterprise

October 28, 2019

Although we wouldn’t describe Oxial as a RegTech firm as such, we do believe that our technology can play a major role in addressing regulatory compliance for organisations in many industries, with Financial Services (FS) a particular sector focus for us.

We bring a more innovative approach to traditional GRC models, one that reduces the cost, frequency and impact of the risks racing businesses. Our GRC software suite, the sGRC solutions, is redefining GRC and is a cost-effective and highly successful GRC tool to ensure any organisation remains compliant and manages risk smartly.

But we also keep a close eye on the world of RegTech. Some RegTech firms could broadly be classed as competitors, whereas others have a more complementary focus. But it’s always interesting to see the amazing innovation that’s at play right now. It’s a sector that is among the most innovativeand there are many start-ups, scale-ups and more established providers that are making a real impact on the world of regulatory compliance.

The rise of RegTech

The RegTech market as we know it has only really emerged over the past five years or so. Deloitte has described it as ‘the new FinTech’ but although it probably hasn’t made the same impact that some FinTech firms have made, it has quickly become very prominent.

RegTech means the application of technology solutions to address regulatory requirements. This is not in itself a new thing – smart firms have been using GRC software solutions to help improve regulatory compliance, governance and risk for longer – but RegTech has certainly captured the imagination over the past five years. Many firms now use RegTech of one kind or another and there has also been significant investment made in RegTech start-ups during this time too.

The growing volume of regulatory requirements has been a big driver in the rise of RegTech, as organisations sought solutions that were nimble, agile and highly effective in keeping on the right side of compliance. RegTech comes in many different types, each trying to address different challenges. Here are some of our favourites.

NetGuardians – a fellow Swiss firm, NetGuardians has been established for more than a decade nowand helps banks to combat financial crime. It uses an Artificial Intelligence solution to proactively prevent fraud, deploying cutting-edge analytics technology to look at customer and employee behaviours, helping banks maintain their reputation and combat financial crime more effectively.

Trulio–headquartered in Canada, Trulio is a RegTech firm that specialises in electronic ID verification. It uses data analysis and open APIs to enable instant verification of identities and addresses. The company collects and collates data from multiple sources – credit records, social media, government accounts and more – and helps FS firms by verifying customers and ensuring they are legitimate, thus protecting against fraud.

Hummingbird– with financial crime on the rise, this San Francisco based RegTech firm is an anti-money-laundering platform used by banks and other FS organisations. It’s a piece of software that facilitates quicker catching of financial criminals and on a far greater scale.

It does this by automating workflows, creating graphics and supplying other investigative tools for AML teams with these FS firms, making AML investigations more ‘agile, lightweight, and intelligent’.

Chainalysis – there are many uses of blockchain emerging around the world, and Chainalysis is a really interesting one in the RegTech space. It is using blockchain to clamp down on and eradicate money laundering, fraud and compliance breaches in cryptocurrency. Its mission statement is to ‘create transparency across blockchains so government agencies,cryptocurrency businesses, and financial institutions can engageconfidently with cryptocurrency’.

Chainalysis also works with FS firmson their Know Your Customer (KYC) requirements and fraud prevention and is operational in 40 countries around the world.

Onfido– is another electronic ID firm, based this time in the UK. It’s a RegTech that deploys machine learning capabilities to help firms comply with anti-money laundering and KYC requirements. It applies automationto the identification verification process, meaning thatusers can background check employees and customers quickly and more accurately.

There is little doubt that RegTech is a sector that is really in the spotlight in 2019. With more regulation than ever before, from GDPR in the EU to the California Consumer Privacy Act in the US, and a whole host of other sector-specific compliance to contend with, RegTech looks set to be with us for the long-haul.

The right RegTech can work in close synch with an IT GRC tool such as Oxial’s, adding even more value to a GRC programme. For information on how Oxial can assist with your GRC requirements, please get in touch with one of our compliance and regulatory experts here.