Post the Great Depression of 2008, there has been a reshaping of attitudes towards banking. IT companies who till now helped banks cater only to their customers are now helping them address other key issues such as regulatory compliance. The dynamic regulatory environment has given rise to the FinTech industry, which focusses on addressing problems faced by banks using latest technology. However, more specifically, it is the RegTech companies that are now making an impact on the banking industry. Let’s take a quick look at why RegTech is taking the banking world by storm.

1. RegTech is the New FinTech
Author: Vedvrat Shikarpur
Technology has impacted our lives in more ways than one since the past few decades. However, it is
only recently that it has been able to make a sizeable difference to the way we bank. The introduction of
new technologies in banking and finance has made life easier for the consumer.
Post the Great Depression of 2008, there has been a reshaping of attitudes towards banking. IT
companies who till now helped banks cater only to their customers are now helping them address other
key issues such as regulatory compliance. 1
Credits: TBIT
1
http://blogs.wsj.com/riskandcompliance/2015/11/24/where-fin-tech-is-struggling-with-regulation/

2. The dynamic regulatory environment has given rise to the FinTech industry, which focusses on
addressing problems faced by banks using latest technology. However, more specifically, it is the
RegTech companies that are now making an impact on the banking industry.
Let’s take a quick look at why RegTech is taking the banking world by storm.
What is RegTech?
The term FinTech was coined to explain the diaspora of IT enterprises in the banking and financial
sector. The 2008 financial crisis revealed that despite significant investments in sophisticated data
management systems, banks were unable to cope with growing risks and regulatory changes2
. Sensing
an opportunity, various tech companies started offering banks a new approach, methodology and tools
to address issues related to data management, governance and compliance. This led to a huge plethora
of technology enterprises focused on dealing with issues faced by banks and financial institutions, out of
which regulatory reporting and compliance was considered to be the most important.
RegTech defines the marriage between technology and regulation to address regulatory requirements.
RegTech companies are offering innovative solutions to:
 Automate manual processes
 Simplify and improve data quality
 Offer a holistic view of data for analysis
 Generate meaningful reports that can be sent to regulators and be used internally to improve
key business decisions
Why banks need RegTech Solution
Since 2008, some of the largest banks in the US have paid $160 billion in fines due to regulatory
compliance issues3
. As a countermeasure to the financial crisis, regulators have come down hard on
banks with new regulations. The addition of new regulatory bodies only adds to the woes banks are
facing. The seismic shift to adopting new regulations and new technologies has led to an even more
dynamic financial environment which most banks are struggling to cope with.
2
http://www.finextra.com/blogs/fullblog.aspx?blogid=11828
3
http://blogs.ft.com/ftdata/author/aaronstanley/

3. Banks are now dealing with large quantities of data, coming from disparate sources, in various types of
formats and at an accelerated pace. They are under pressure to properly manage and store data to
avoid the inevitable reporting fines as they are unable to generate key reports in a timely and efficient
manner.
This has led financial institutions to look for fresh and innovative approaches and solutions like those
offered by RegTech firms.
Attributes of RegTech Compliance Solution
RegTech companies typically offer four characteristics4
:
1. Agility- Decouple and organize cluttered and intertwined datasets through the process of ETL
(Extract, Transfer, Load) efficiently
2. Speed- Generate and configure reports from standardized data
3. Integration- Amalgamation of reports in short timeframes to get solution up and running
4. Analysis- Intelligently mine existing datasets to unlock their true potential by presenting it in a
simple and easy to understand manner
4
http://www2.deloitte.com/content/dam/Deloitte/ie/Documents/FinancialServices/IE_FS_RegTech_0815-
Final%20Draft_.pdf

4. The key difference between traditional solutions and RegTech solution is ‘agility’. While traditional
solutions offer a robust design created to deliver specified requirements, they are largely inflexible and
require coding to be enhanced or changed. This leads to added complexities in the process, involving
more manpower and price tags5
.
RegTech companies help financial firms automate mundane compliance tasks and reduce operational
risks associated with meeting compliance and reporting obligations. This helps reduce the cost involved,
improves performance and security, adds flexibility and drastically reduces the time required to
complete the task.
The Complete RegTech Compliance Solution
Hexanika is a RegTech big data software company which has developed a software platform SmartJoinTM
and a software product SmartRegTM
for financial institutions to address data sourcing and reporting
challenges for regulatory compliance.
In the last five years, banks have paid a cumulative $300 Billion in fines resulting from fraud, regulatory
non-compliance and inaccurate reporting. Our innovative and unique “end to end” platform SmartJoinTM
combined with product solutions SmartRegTM
are anchored on semantic and machine learning
algorithms. SmartJoinTM
improves data quality whereas the automated nature of SmartRegTM
keeps
regulatory reporting at pace with the dynamic regulatory requirements thereby catering to market
needs efficiently.
5
http://www.fintech.finance/homebox/regtech-solutions-will-help-firms-to-automate-compliance-tasks-and-
reduce-operational-risks-says-deloitte/

5. Contact Us
USA
249 East 48 Street,
New York, NY 10017
Tel: +1 646.733.6636
INDIA
Krupa Bungalow 1187/10,
Shivaji Nagar, Pune 411005
Tel: +91 9850686861
Email: info@hexanika.com
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