TL;DR
The growing complexity of global financial regulation has turned compliance into one of the sector’s largest cost centres. As institutions expand across jurisdictions, regulatory technology (RegTech) solutions—which automate monitoring, reporting, and risk management—are becoming essential for maintaining compliance and preventing costly fines. By streamlining regulatory processes and providing real-time oversight, RegTech enables firms to meet evolving obligations with greater accuracy, speed, and control.
Why RegTech matters now
Since the 2008 global financial crisis, financial regulators have created a wide array of new regulations, from the Dodd–Frank Act in the US, MiFID II in Europe and the UK, to the Basel III framework for international standards. This tightening of oversight, while crucial for market stability, has placed enormous operational strain on firms.
In 2024 alone, financial institutions paid over $19.3 billion in regulatory penalties for compliance breaches—a record figure that highlights both the scale of enforcement and the operational cost of non-compliance. The trend has continued into 2025. According to Fenergo, global fines reached $1.23 billion in the first half of the year, up 417% from the same period in 2024, with the sharpest increases linked to anti-money laundering (AML) and sanctions violations.
At the same time, institutions face a dual challenge: a surge in cross-border operations and the rapid evolution of regulatory expectations around technology, data, and conduct. Against this backdrop, RegTech has evolved from a niche solution into an indispensable component of modern financial infrastructure.
What is RegTech?
RegTech refers to the use of technology—such as artificial intelligence, machine learning, cloud computing, and data analytics—to analyse, interpret, automate, and improve regulatory and compliance processes. It allows institutions to identify and implement their obligations more efficiently while enhancing transparency, reducing operational risk and improving regulatory insight.
According to McKinsey, current RegTech solutions fall into four main categories:
Financial risk, capital management and regulatory reporting: Tools for liquidity, stress testing, and fund transfer pricing.
Governance, risk, and compliance (GRC): Platforms that map, monitor, and report on regulatory obligations across jurisdictions.
Cybersecurity and IT risk: Solutions addressing data protection, system integrity, and operational resilience.
Financial crime and AML/KYC compliance: Systems for detecting suspicious transactions, screening customers, and managing fraud prevention.
These technologies enable institutions to interpret, operationalise, and evidence compliance obligations at scale— at a level of efficiency and accuracy that manual compliance teams can no longer realistically achieve on their own.
A market defined by growth
Industry forecasts point to sustained, double-digit growth across the RegTech sector:
| Forecast provider | Market outlook (2025–2030) |
|---|---|
| Mordor Intelligence | 2025 market size: $20.67 billion; 2030 projection: $44.11 billion; CAGR (2025–2030): 16.37%. |
| Grand View Research | 2025 market size: ~$22 billion; 2030 projection: $70.64 billion; CAGR (2025–2030): 23.1%. |
| IMARC Group | 2025 market size: ~$18.7 billion; 2030 projection: ~$45 billion; CAGR (2025–2030): 18.0%. |
Beyond its size, the RegTech market’s importance lies in its strategic value: it converts compliance from a cost burden into a competitive advantage, allowing firms to expand confidently across multiple jurisdictions.
Key benefits for financial institutions
| Benefit | Impact |
|---|---|
| Automation | Dramatically reduces manual workload and human error in data collection, reporting, and monitoring. |
| Real-time monitoring | Detects compliance issues instantly - particularly critical for AML, sanctions and fraud prevention. |
| Cost efficiency | Yields significant savings by streamlining processes and avoiding fines. |
| Scalability & accuracy | Adapts to growth and regulatory changes; advanced analytics enhance risk insights. |
| Centralised oversight | Provides a single view of global requirements, simplifying multi-jurisdictional compliance. |
Together, these capabilities translate into fewer breaches, lower operational costs, and stronger regulatory relationships.
Why this matters for multi-jurisdictional compliance
For institutions operating across several jurisdictions, compliance complexity multiplies. Each regulatory regime—from the Financial Conduct Authority (FCA) and Prudential Regulation Authority (PRA) in the UK, the Securities and Exchange Commission (SEC) in the US, to the Monetary Authority of Singapore (MAS) in Singapore—defines its own reporting rules, timelines, and data standards.
RegTech’s key contribution is standardisation and unification:
Consolidated oversight: Centralising global regulatory requirements and mapping them to internal controls.
Cross-regulatory alignment: Ensuring consistent adherence to frameworks such as Basel III, MiFID II, and the Digital Operational Resilience Act (DORA).
Automated evidence generation: Providing audit-ready records that satisfy multiple supervisors simultaneously.
In short, RegTech enables firms to transform fragmented compliance processes into a single, harmonised ecosystem.
The business case: reducing exposure and building resilience
Financial institutions operate within a regulatory landscape that shifts continually, where delays in interpreting new requirements can precipitate non-compliance and substantial penalties. Advanced RegTech platforms illustrate this capability by continuously monitoring regulatory developments and mapping them against existing regulatory rules and standards as well as internal policies and controls.
Such systems enable firms to:
Lower exposure to enforcement actions: Early identification of emerging obligations and proactive adjustment of controls.
Enhance transparency: Maintaining clear linkages between regulatory updates, affected processes, and audit-ready evidence.
Strengthen resilience and efficiency: Automating horizon scanning, rule interpretation, and reporting—reducing manual effort, accelerating response times, and minimising compliance costs.
Looking Ahead: regulation meets technology
Currently, regulators are themselves adopting RegTech—or supervisory technology (SupTech)—to enhance their capabilities for supervising and analysing he firms under their purview. This creates an interesting dynamic between authorities and FS firms: as companies deploy RegTech for real-time reporting and compliance automation, regulators leverage SupTech to analyse that data with greater speed and precision, accelerating the shift toward more digitally native supervision.
As compliance evolves from static documentation to dynamic, continuous monitoring, institutions that invest early in robust RegTech infrastructure will be best positioned to adapt. They will seamlessly align with emerging compliance frameworks, meet heightened operational resilience expectations, and capitalise on growing cross-border interoperability as regulators converge on common standards. In this integrated ecosystem, proactive adoption of RegTech becomes a strategic imperative for sustained regulatory alignment and competitive resilience.
How Braithwate can help
As regulatory expectations grow more data-driven and interconnected, compliance demands continuous, technology-enabled oversight. At Braithwate, we have developed two purpose-built RegTech solutions - RegPass and FintechXpndr - that address different regulatory compliance challenges faced by fintechs and financial services firms.
FintechXpndr streamlines licensing, authorisation, and market expansion, helping fintech start-ups and new entrants navigate complex approval pathways with speed and confidence.
RegPass is the next-generation AI-powered regulatory change management platform that identifies and assesses relevant regulatory alerts and extracts actionable regulatory obligations to enable firms to demonstrate compliance effectively.
Together, these solutions reduce cost, risk, and response time—turning compliance from a reactive burden into a strategic driver of operational excellence and sustainable growth.
Sources
IMARC Group, RegTech Market Size, Share, Growth, Trends, Forecast 2033 (2025): https://www.imarcgroup.com/regtech-market
Grand View Research, Regulatory Technology Market Size, Share & Trends Analysis Report (2025): https://www.grandviewresearch.com/industry-analysis/regulatory-technology-market
Mordor Intelligence, RegTech Market - Growth, Trends, COVID-19 Impact, and Forecasts (2025–2030) (2025): https://www.mordorintelligence.com/industry-reports/global-regtech-industry
Market growth projections in the table are sourced from the reports above.