The Need for Regtech & AI in Compliance
Regulatory technology, which is popularly known as RegTech, as the name suggests is the intersection of regulation and technology. It is an upcoming sphere of digital technology that has been evolving with the intent to make compliance simple and digitised by using artificial intelligence. This automated technology for due diligence and compliance is known for fixing inconsistencies within regulatory practices. It is often demanding for regulatory bodies to oversee and supervise situations in the industry and safeguard them with regulations.
Keeping up with the dynamic regulations and practices and complying with them can be challenging for the compliance officers. Regulators nowadays demand more information due to the need to be transparent, which has brought automated technology into the picture for quicker and more meticulous implementation. This has led financial institutions to seek assistance from a technologically progressive form of regulatory compliance in order to combat the complex myriad regulations and save time as well as money. Automation of compliance cuts down the cost and human errors.
Artificial Intelligence efficiently and skilfully processes a large amount of data more accurately than humans could, potentially revolutionising the world of regulatory compliance. This form of technology can be utilised to understand compliance requirements, functions and keep up with the ever-changing regulations. The system can go through regulatory documents and decipher these documents and summarise it to a simplified form by highlighting the essential elements along with inferences. This is a positive respite for most businesses.
AI and Regtech helps compliance officers perform accurately, avoiding errors and inconsistencies within the regulatory framework, be productive with their compliance requirements and monitor risks more effectively. The increasing dependence on compliance in businesses has definitely increased over the years and it will continue to grow in the near future as well. The implementation of AI and regulatory technology can be a breather for such business entities.