At the start of June, Marketing & Partnerships Manager, Matt Flenley was a panellist on an A-Team webinar on overcoming barriers to RegTech adoption alongside Sophia Bantanidis of Citi, Kayvan Alikhani of Compliance.ai, and Patrick Boscher of Pabora.io. With questions posed by Sarah Underwood, the webinar delved deep into views from different sides of the fence – buyers, sellers and investors – seeking to provide a broad understanding of the barriers each side face with regulatory compliance and adopting regtech solutions. Here, he focuses on a few of the biggest talking points raised by the webinar. 

From the moment the panellists began introducing themselves, I knew it was going to be pretty wide-ranging. Patrick Boscher is ex-Allianz Group, now RegTech advisor and Startup Angel; Sophia Bantanidis is a former regulator, now leading RegTech & Fintech innovation at Citi’s Innovation Lab; Kayvan Alikhani of Compliance.ai, a technologist who’s worked with hundreds of compliance officers; and then, of course, me – now at a Fintech/RegTech, but formerly in a bank and dealing with the sorts of problems that technology is rapidly solving.  

A-Team Group usually gets a good panel together, full of opinions from across the sphere of a debate, and this was no different. 

Sophia Bantanidis’s views reflected the need of a massive financial organisation to have regtech companies think big – how can my solution be deployed at an enterprise level to solve multiple problems around regulatory requirements and risk management for thousands of people, in hundreds of different countries? – and the counterpoint RegTech adoption view from Kayvan Alikhani was that banks should think in terms of specific problems they have right now that must be solved, even on a small scale. 

Fundamentally, the most important thing emerging was that both sides – all sides, including investors – have a strong desire to make it work and improve their regulatory processes with the help of RegTech. 

Innovation centres at banks are a superb way of getting a foot-in-the-door, and as Ms. Bantanidis said – they can act as a sponsor throughout the organization, a champion for the firm to gain a foothold and start to grow.  

This willingness to support innovative tech firms flourishing in organisations is something the independent commentator Chris Skinner expanded upon in a session last year held by the FS Club on digitisation (and the focus of his most recent book); he asserted that much of the evolution necessary to fully benefit from the opportunities that RegTech promises in mitigating against financial crime and improving the financial services industry requires a change in mindset within banking and finance, to become data-and-digital-first – and not simply parrot those statements without changing the underlying structure of banking and financial regulations. 

Now, it would be too easy – not to mention wrong – for me to suggest that all we need for a banking and finance revolution is for the banks to evolve culturally! 

Like partners in a relationship where perhaps different views on a point are held, we need a willingness to work things out together and some intelligent mediation along the way. The webinar’s conclusion really hit home on this, with some sage points of advice and compromise:

• RegTechs shouldn’t over-inflate their involvement with a financial institution, because they’ll figure out that the contract with a big bank that’s on the sales deck was actually just a one-off piece of work which didn’t go anywhere;

• Banks mustn’t just put RegTechs into the same IT procurement process as used for giant blue-chip tech firms; there’s a need to be creative and flexible, as difficult as that might sound for banks (and I do genuinely understand!)

• RegTechs should tell the innovation department at a bank if they’re already working on a project elsewhere in the organisation to avoid miscommunication – something Ms. Bantanidis was really very clear about

• Lastly, banks should view a paid project with a RegTech – at the very worst – as a valuable way of “failing fast.” It might be a big cultural shock to think this way, but the saying is true: if we always do what we’ve always done, we’ll always get what we’ve always got. And in 2020, with no let-up in regulatory reporting scrutiny and COVID-19 pressuring margins, it’s clear that backing the right RegTech adoption could turbocharge compliance while delivering better efficiencies. Regulatory technology offers the opportunity to compliment compliance teams and make their regulatory obligations easier to deliver.

Next up for Datactics on the webinar front, we’ve Head of Sales Kieran Seaward in a Wealth Management special on “Future Proof Operating Models”, followed a week later by Head of AI, Dr Fiona Browne, exploring uses of AI in AML & Know Your Customer. I’ll share details of these in my LinkedIn feed, or follow the company one here. 

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