During the pandemic, financial institutions have been accelerating spending on regulatory technology, a survey of almost 40 organisations conducted by ClauseMatch has found.

More than 42% of survey respondents witnessed a sharp rise in spending on regulatory solutions over the last six months, due to changes in working practices during the pandemic. The research also showed that 50% of demand from all new businesses for the regtech industry is from banks, which have been slow to embrace new technologies.

Of those surveyed, 92% of firms said that the pandemic has positively impacted the adoption of cloud-based products. The most dominant trend throughout the pandemic was the increase in remote compliance, with 92% of organisations have shifted to a remote working model during the pandemic.

Because of remote working during the pandemic, many employees have turned to unmonitored communication apps such as WhatsApp to share sensitive information. Survey participants also reported that the pandemic has caused a rise in virtual Know Your Customer (KYC) checks.

Regarding what extent participating firms within the survey would like to see the regulator take a more proactive role in the promotion of regtech solutions, their answers were as follows: 15.4% of participants said they wished to see the regulator take a less active role, 21.3% of participants said they would like to see the regulator remain moderate in its efforts, and 61.5% of participants said they would like to see the regulator being considerably more proactive in adopting regtech.