Financial services organisations have, by necessity, been implementing technology solutions rapidly in recent years. As a result, the digital revolution of finance has been quick and sharp - the birth of FinTech demonstrates how technology has the capacity to overhaul the established businesses and even create new ones. It is worth noting, in this regard, that while there are several advantages, there are also several significant hurdles to overcome.
In addition to the greater regulatory risk, there are significant challenges that one would come face to face with while using FinTech and RegTech applications. The reasons given for not implementing FinTech include the lack of investment, lack of in-house skills, and poor infrastructure. It mirrors some of the broader challenges that respondents identified when deploying these applications, where the availability of skills, data governance, and the regulatory approach featured prominently.
Regulators today are also espousing tech solutions to aid their supervisory roles, using inordinate amounts of data for the process. What needs to be added, however, is adequate streamlined interaction between regulators and firms on RegTech and FinTech.
Going ahead, although there are expectations of a slowdown, there are considerable benefits to be gained from the successful deployment of technology, including the development of better risk management tools, the automation of processing, improved tracking of regulatory change as well as the streamlining of data governance, all of which should free up time for more compliance value-add tasks.
Despite this current slowdown and waning enthusiasm, the future of the fintech market remains optimistic, the report observes, recommending that financial services firms should continue investing in technology, IT infrastructure, and associated skillsets. Moreover, to maximise the potential of technological innovation, firms must continually reassess their technical needs and invest in solutions tailored to the activities of their business.