Regulatory technology

Regulatory technology, usually shortened to RegTech, is the use of information technology to improve how organizations carry out regulatory and compliance work. It is applied most often in heavily regulated fields such as financial services, gaming, healthcare, pharmaceuticals, energy and aviation, where platforms concentrate on monitoring regulation, reporting to authorities and demonstrating compliance. The aim is to lower the cost of regulation for firms and for regulators while making rules clearer and outcomes of higher quality. In finance its applications include regulatory reporting, supervisory compliance, risk management and transaction monitoring, supporting requirements such as Know Your Customer and anti-money laundering rules. The UK Financial Conduct Authority was the first governmental body to promote the term, describing RegTech as a sub-set of FinTech. Growth in the field has been driven by the high cost of compliance and the large fines imposed after the 2008 financial crisis.