RegTech Market Analysis Report By Organization Size, By Application, By Region And Segment Forecasts From 2019 To 2025

Industry Insights

The global RegTech market size was accounted for USD 2.87 billion in 2018. It is projected to witness significant growth with 52.8% CAGR over the forecasted years, 2019 to 2025. The rising need for regulatory intelligence and higher compliance costs are projected to boost the demand for RegTech (regulatory technology) solutions across the globe.

RegTech has been derived from FinTech in 2015 and is witnessing popularity across the globe. It includes the usage of various tools for complying with the business functioning with stringent regulations and lowering business compliance risks. The adoption of such solutions along with real-time analysis of compliance can help in connecting businesses and regulators, thereby safeguarding customer’s interests. A recent study by the World Bank stated that usage of such a regulatory framework can help in boosting the GDP up to 2.0% annually.

The cost incurred in compliance for several financial institutions has been rising exponentially over the last few years. Lowering these costs and compliance failures will enhance the business processes by improving the response timing and thus can increase ROI (Return of Investment). Several financial organizations are influencing their customers to open the KYC (Know Your Customer) document for bank account opening and transactions. It facilitates the banks to identify customer’s details, thereby ensuring safe and secure service to their customers.

Advanced technologies like AI (Artificial Intelligence), ML (Machine Learning), and Automation are being largely used in the development of such RegTech solutions. The usage of AI facilitates the process of fraud identification. Moreover, the adoption of artificial intelligence can help in curtailing the overall operational cost and enhancing transparency in financial transactions.

Organization Size Insights

The segment of large enterprises held the largest share across the global regulatory technology market in 2018. This can be attributed to their rising need for the adoption of compliance and risk management solutions prevailing among large enterprises across various industrial verticals. Service and consultation providers like Deloitte, PwC, Thomson Reuters, and IBM have started offering various solutions to large enterprises for effective management of business functions. Moreover, the rising usage of advanced analytics, workflow automation, and robotics in process automation is anticipated to digitalize the risk and compliance management functions.

The SMEs (small and medium enterprise) segment is projected to witness the highest growth with 59.3% CAGR during the forecasted period, 2019 to 2025. This can be associated with the surging need for compliance and risk management solutions prevailing across small and medium scaled organizations for ensuring their data security and effective functioning.

Application Insights

In 2018, the segment of risk & compliance management dominated the global market and generated a revenue of USD 833.6 Million. This can be associated with the rising adoption of such solutions across the U.K. and the U.S. on account of the rising need to manage many complex banking processes and to ensure enhanced compliance management execution.

The integration of such RegTech solutions with conventional technology platforms is projected to enhance its compliance functionality. These steps undertaken by financial institutions are projected to boost their agility, financial transparency, and operational efficiency. Further, the reduction in costs required for attaining compliance regulations can be achieved with their usage. Such factors are projected to positively impact the market growth for RegTech solutions over the forecasted years.

The application segment of regulatory intelligence is projected to witness the highest CAGR during the forecasted years, 2019 to 2025. This can be attributed to the rising adoption of such solutions across insurance, financial services, banking, and other sectors. Moreover, features like gathering, analyzing, and monitoring regulatory data and development tracking are anticipated to fuel up its demand. It also allows users to carry flexible research analysis even while monitoring compliance and the regulatory environment.

Regional Insights

North America is anticipated to dominate the global market with the largest share from 2019 to 2025. This can be attributed to the surging need for reducing fraudulent activities and establishing compliances with the upcoming stringent regulations. Also, the imposition of strict rules across the finance sector is projected to fuel up the market growth across this region.

Rising compliance issues prevailing across this region are also projected to contribute to its market growth. The U.S. is more inclined towards compliance & risk management and automating the conventional regulatory processes. Several companies located in the U.S. like Deloitte, Broadridge Financial Solutions, and IBM are developing new RegTech solutions for the automation of business processes.

COVID-19 Impact Insights

The ongoing COVID pandemic is expected to impact the market growth of RegTech across the globe. Reduction in the number of financial transactions due to the imposition of lockdown and stagnancy across various business verticals owing to ongoing crisis is hindering the market growth. However, the number of financial frauds in the post-pandemic period is expected to increase on account of the increased unemployment rate. Thus, the need for compliance and financial risk management solutions is anticipated to boost across several large institutions. Further, rapid technological advances being carried out in AI, Robotics, and ML technologies for the reduction of operational costs are projected to drive the market growth in the upcoming years.

Key Companies & Market Share Insights

The key players in the global RegTech market are PwC; IBM; NICE Actimize; BWise; Wolters Kluwer; London Stock Exchange Group plc; Infrasoft Technologies Ltd. and Accuity. These players are continuously engaged in expanding their product portfolio to gain a competitive advantage over other players.

For example, Broadridge gained an acquisition over a service provider of sales & marketing solutions named FundAssist Limited in 2018. It enabled smooth functioning of distribution, management, and composition of disclosure documents and digitized regulatory. This acquisition is anticipated to benefit the business competencies and existing governance of Broadridge across the European fund market.

Report Scope

Segments Covered in the Report

This report forecasts revenue growth at the global, regional, and country levels and provides an analysis of the latest industry trends from 2015 to 2025 in each of the sub-segments. For this study, Million Insights has segmented the global RegTech market based on organization size, application, and region:

• Organization Size Outlook (Revenue, USD Million, 2015 - 2025)
    • SMEs
    • Large Enterprises

• Application Outlook (Revenue, USD Million, 2015 - 2025)
    • Risk & Compliance Management
    • Identity Management
    • Regulatory Reporting
    • Fraud Management
    • Regulatory Intelligence

• Regional Outlook (Revenue, USD Million, 2015 - 2025)
    • North America
        • U.S.
        • Canada
    • Europe
        • U.K.
        • Germany
        • France
    • The Asia Pacific
        • China
        • India
        • Japan
    • Latin America
        • Brazil
        • Mexico
    • Middle East & Africa
        • Saudi Arabia
        • UAE
        • Africa