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FinTech Global: Recordkeeping, regulations and consolidation – the RegTech trends that stood out in 2023

By December 15, 2023January 4th, 2024No Comments
Recordkeeping regulations and consolidation the RegTech trends that stood out in 2023 696x522 1


In 2023, new technologies entered the market that brought new challenges for financial services firms to remain compliant, RegTech was given the opportunity to provide the solutions necessary to fix this issue. Whilst the industry may be still relatively unknown beyond the shores of finance, its importance cannot be understated.  

In this second-part of a two-part review of the RegTech trends that mattered this year, FinTech Global spoke to key industry players on topics such as recordkeeping, regulatory challenges, industry growth, risk and partnerships.

Despite Generative AI making a huge noise across the financial world this year, there were a number of other key trends that were highly noticeable in 2023. One particular trend that has stood out, and particularly been a challenge for financial firms, has been recordkeeping.

Stacey English, director of regulatory intelligence at Theta Lake, emphasised that the key trend of 2023 was the unremitting regulatory focus on recordkeeping and the persistent use of unmonitored communications channels.

She stated, “This year saw fines reach a staggering $2.6bn from US regulators with senior individuals also being sanctioned. Having seen the regulatory net being widened to include not only banks, but also brokers, investment advisers and credit rating agencies alongside a growing list of regulators taking enforcement action, including the UK’s PRA and energy regulator Ofgem, it’s no surprise that firms have turned to technology providers like Theta Lake to help solve their recordkeeping problems once and for all.”

In the view of English, it has been clear that the financial services industry has struggled to meet its recordkeeping obligations. She also remarked that the compliance pain and incompatibility with unified communications and collaboration (UCC) of existing archiving and recording tools is ‘all too real’ – with almost all (98%) of the 600+ senior leaders who took part in Theta lake’s independent research dissatisfied with their existing archives and voice recording tools.

“The fact that 68% of firms have been forced to disable core features across their approved platforms like Zoom, Microsoft Teams and Cisco Webex, because existing compliance tools can’t effectively capture them and/or make them searchable for detecting and reporting risks, has only served to exacerbate compliance issues,” said English.

She continued, “Not least, employees turning to unapproved and unmonitored channels like WhatsApp as alternative ways to effectively communicate with customers. Of particular concern is the 74% who said it’s likely their employees are using unmonitored communication channels, up from 66% in 2022. That’s alongside a diminished ROI from the collaboration tools they’ve invested in.”

This has led many companies throughout 2023 to turn to Theta Lake for modern compliance tools built for UCC platforms, English quipped. They are turning to them she states in order to address the challenges they face from having disparate compliance tools that specialize in traditional voice recording or originally built for email-based archives.

“Whether that’s the need to capture the context of communications such as emojis, reactions and edits, be able to instantly review communications that span video, voice, chat, whiteboards and file sharing or provide reconciliation to evidence that all records have been captured,” said English.

With this in mind, the Theta Lake director of regulatory intelligence highlighted that an effective approach to communications compliance is long overdue. In this respect, she claims it’s no surprise to hear firms are revisiting their approach to communications with almost half (48%) investing in specific communication compliance solutions and 40% having made communications compliance a board level topic. “As 2023 comes to a close, we can expect the issue to take centre stage in 2024,” she concluded.


Read the full article here.

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