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FCA release findings of its call for input on the adoption of 'RegTech'

FCA releases findings from its call for input on supporting the development and adoption of RegTech, as well as outlining its approach for 2016/17.

Last week the Financial Conduct Authority released findings from its call for input focused on supporting the development and adoption of RegTech, as well as outlining its approach for 2016/17.

With ongoing growth in competition, the post-crisis realisation of risk associated with the globalisation of finance, and the emergence of multiple jurisdictional reporting formats, never before has the act of compliance been so complex. Given the underlying importance of technology in the UK’s financial infrastructure, and that the proliferation of innovation in the sector is accelerating, RegTech will play a crucial role in the ability of regulation to keep pace with industry developments, ensure financial stability and ultimately consumer protection. The FCA defines RegTech as ‘a sub-set of FinTech that focuses on technologies that may facilitate the delivery of regulatory requirements more efficiently and effectively than existing capabilities’.

The findings and forward planning demonstrate a strong commitment on the FCA’s part to the development of RegTech solutions and collaboration among regulated firms, regulators and solution providers. Here, technology can better facilitate interaction with the regulator, create compliance efficiencies and the use of shared utilities, better predictive analyses via machine learning, and respond to the development of new technologies such as blockchain and biometrics via horizon scanning. 

In March 2016, techUK facilitated a roundtable with members on behalf of the FCA, a summary of which is available to download here. It is extremely encouraging to see recommendations reflected in the FCA’s forward planning, namely, around support for the development of industry standards, improved collaboration & engagement with RegTech solution providers and the possibility of a certification for RegTech that meets relevant criteria.

Ultimately, the marriage of regulators, regulated firms and RegTech solution providers will improve communication and better compliance outcomes. techUK will look to support the FCA as more details of the FCA’s approach emerges, and in particular, will look to build on work undertaken with the British Standards Institute to support the development of standards for Fintech.

 

Channel website: http://www.techuk.org/

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