Abstract

Regulatory Technology (RegTech) represents a significant evolution in the compliance landscape for financial technology (Fintech) firms. The escalating complexities of the global regulatory landscape, coupled with the rapid evolution of the Fintech sector, have rendered traditional governance, risk, and compliance (GRC) frameworks increasingly inefficient and expensive. With increasingly complex GRC requirements, RegTech solutions promise to automate, streamline, and improve regulatory management. This paper examines the challenges, drivers and legal implications of RegTech adoption. Further, this paper meticulously examines the transformative potential of RegTech in revolutionizing GRC operations within the burgeoning Fintech industry. Leveraging advanced technologies such as Artificial Intelligence (AI), Machine Learning (ML), blockchain, and big data analytics, RegTech solutions offer unprecedented capabilities for automating compliance processes, facilitating real-time risk monitoring, and ensuring accurate, timely regulatory reporting. By integrating doctrinal research with qualitative analysis of industry reports and case studies, this study identifies the main factors driving adoption, including achieving cost efficiencies, improving accuracy and responding effectively to regulatory pressures. It also investigates significant barriers including data privacy concerns, cross-border compliance complexity, liability issues, and the lack of industry-wide standardization. Comparative analysis of regulatory approaches in jurisdictions including the European Union, United Kingdom, United States, Singapore, and Australia highlights both supportive policies and gaps in harmonization. The findings underscore that while RegTech adoption is accelerating and delivering operational benefits, uneven regulatory guidance and legal uncertainty continue to pose challenges. The paper concludes with actionable recommendations for Fintech entities, RegTech providers and regulatory bodies, advocating for collaborative ecosystems, standardized data practices, and continuous investment in human capital development to fully harness RegTech’s potential in shaping a resilient, compliant and innovative future for digital finance. This manuscript posits that RegTech is no longer merely a supportive tool but a foundational pillar for sustainable growth and ethical operations in the modern financial ecosystem.

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