Regtech spending grows 48 percent per annum

Thus, the costs will be rising from USD 10.6 billion in 2017 to USD 76.3 billion in 2022 – as banks seek to avoid costly regulatory fines. Among top three key regulatory fines since the financial crisis of 2008, the study finds Bank of America (USD 16.7 billion in 2014), JPMorgan Chase (USD 13.0 billion in 2013), Bank of America (USD 11.8 billion in 2012) in US and BNP Paribas France (USD 8.9 billion in 2015), Deutsche Bank Germany (7.2 billion in 2016) and Credit Suisse Switzerland (USD 5.3 billion in 2016) in Europe.

Furthermore, the research, Regtech Strategies for Financial Services 2017-2022, found that regtech spending, as a percentage of regulatory spending, will increase dramatically, from 4.8% in 2017 to 34.4% by 2022.

This represents a vast opportunity for regtech vendors, who can capitalise on banks seeking efficiency in meeting regulatory compliance requirements. Thus, regtech investment will be dominated by established technology players, such as Cisco and IBM. Juniper anticipates that existing vendors of financial services software, such as Oracle and SAP, will look to enhance their offerings with regtech features and possibly acquisitions, according to the study. Furthermore, consultancy companies, such as Deloitte and KPMG also have a key role and may look to partner with regtech vendors.