My thoughts on the evolution of Regtech: In print and in speech

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I have published a book chapter entitled “Regtech unleashed: Technological paths in the regulatory landscapes beyond financial services” in the upcoming book “The RegTech Book,” which will be the first globally crowd-sourced book about innovation in the Regulatory Technology Sector. It is part of TheFinTechBook series, which is published by Wiley Finance.

Here is the abstract of the article:

Many types of regtech are readily adaptable beyond financial services (“FS”) to environmental protection and regulation of food and product safety among other fields, especially data aggregation, modelling, scenario analysis, forecasting, and monitoring technologies. Market demands for broadening the definition and use-cases of regtech (e.g. the applications of Ayasdi in FS and non-FS cases) should be driven by the complexities of record-keeping, reporting and disclosure  requirements, and the needs of regulated firms to avoid or mitigate loss of license and other severe penalties, collateral civil litigation, disruption of business and reputation damage in the event of breaches. The compliance pressures are compounded by tight timelines and the tremendous data volume, variety and velocity involved. Regulatory updates and staff training are similarly needed in different sectors. This article examines the non-FS regtech that could provide great efficiencies and lower costs to meet these demands. Technologies enhancing informational and logistical efficiencies should revolutionise the regulatory agenda and enable innovative regulatory measures. Market-based regulation, such as carbon trading, requires highly efficient pricing, which could be achieved with technologies capturing multi-sensory and unstructured data, providing sophisticated analytics and (near) real-time feedback. Process automation technologies could direct firms’ behaviour when “regulation-as-code” becomes mainstream and spreads from FS to non-FS sectors. This article argues that while convergence between information technology and regulation will inevitably impact virtually all sectors, reduction of regulatory friction by technology could in fact erode individual rights and weaken the rule of law. Development of regtech in the broad sense should be guided by comparative analyses of FS and non-FS regulations and their market interactions. The application of regtech beyond FS will thrive once it is properly aligned in function, purpose and value with the underlying regulation. 


Due to a recent increase in the public’s attention on RegTech, I have also spoken on relevant topics on several occasions in 2019, including a panel session at the R One co-working space and a session at the World RegTech Summit @HK.

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