Strategic Intelligence RegTech report August 2025

Regtech uses tools such as artificial intelligence (AI), data analytics, blockchain and cloud computing to streamline compliance and reduce associated costs. Solutions are designed to meet various regulatory and operational goals across industries. These include enhancing data privacy and security, promoting regulatory innovation, improving regulatory reporting, managing regulatory risks, and ensuring ongoing regulatory compliance.

There are several drivers of regtech adoption. As regulated entities undergo digital transformation, they seek technologies that can integrate effectively with modern architectures and workflows. Regtech solutions use AI and data analytics to enhance real-time monitoring, reporting and risk assessment. This move from manual to digital processes not only increases efficiency but also improves accuracy and scalability in compliance operations. The global regulatory landscape has become increasingly complex, with frequent updates and divergent rules across jurisdictions. Regtech tools help companies interpret and comply with this evolving web of regulations by automating the tracking, mapping and implementation of legal requirements. Furthermore, traditional compliance methods are resource-intensive, requiring substantial investment in personnel, training and systems. Regtech provides cost-effective alternatives by automating routine compliance tasks such as transaction monitoring, identity verification and reporting.

Regtech’s impact varies significantly across different sectors, with the financial services sector at the forefront of innovation. Since the 2008 global financial crisis, regulatory requirements for banks, insurers and asset managers have increased significantly in volume and intensity, creating a pressing need for more intelligent and scalable compliance solutions. As a result, most regtech start-ups have focused on serving this industry, developing tools tailored to banking-specific challenges such as anti-money laundering (AML) requirements, know your customer (KYC) processes, and real-time risk monitoring. Nonetheless, sectors like manufacturing, technology and healthcare are also witnessing significant adoption due to growing regulatory scrutiny. New sector-specific platforms will emerge to address unique regulatory frameworks and reporting standards in different industries. This cross-industry adoption will significantly broaden the regtech market and drive innovation in modular, adaptable regtech solutions.

AI will also become deeply embedded across end-to-end compliance workflows, transforming regtech from reactive monitoring to proactive risk prevention. AI will automate not just data analysis, but also regulatory interpretation, decision-making, and continuous monitoring across jurisdictions. Natural language processing (NLP) and machine learning models will update compliance systems as new regulations emerge. This shift will reduce human error, cut costs, and allow compliance teams to focus on strategic oversight instead of manual checks.

Main image: Beyza Karakoy, Senior Analyst, Strategic Intelligence team at GlobalData.

Regtech uses tools such as artificial intelligence (AI), data analytics, blockchain, and cloud computing to streamline compliance and reduce associated costs. Solutions are designed to meet various regulatory and operational goals across industries. These include enhancing data privacy and security, promoting regulatory innovation, improving regulatory reporting, managing regulatory risks, and ensuring ongoing regulatory compliance.  

There are several drivers of regtech adoption. As regulated entities undergo digital transformation, they seek technologies that can integrate effectively with modern architectures and workflows. Regtech solutions use AI and data analytics to enhance real-time monitoring, reporting, and risk assessment. This move from manual to digital processes not only increases efficiency but also improves accuracy and scalability in compliance operations. The global regulatory landscape has become increasingly complex, with frequent updates and divergent rules across jurisdictions. Regtech tools help companies interpret and comply with this evolving web of regulations by automating the tracking, mapping, and implementation of legal requirements. Furthermore, traditional compliance methods are resource-intensive, requiring substantial investment in personnel, training, and systems. Regtech provides cost-effective alternatives by automating routine compliance tasks such as transaction monitoring, identity verification, and reporting. 

Regtech’s impact varies significantly across different sectors, with the financial services sector at the forefront of innovation. Since the 2008 global financial crisis, regulatory requirements for banks, insurers, and asset managers have increased significantly in volume and intensity, creating a pressing need for more intelligent and scalable compliance solutions. As a result, most regtech start-ups have focused on serving this industry, developing tools tailored to banking-specific challenges such as anti-money laundering (AML), know your customer (KYC), and real-time risk monitoring. Nonetheless, sectors like manufacturing, technology, and healthcare are also witnessing significant adoption due to growing regulatory scrutiny. New sector-specific platforms will emerge to address unique regulatory frameworks and reporting standards in different industries. This cross-industry adoption will significantly broaden the regtech market and drive innovation in modular, adaptable regtech solutions. 

AI will also become deeply embedded across end-to-end compliance workflows, transforming regtech from reactive monitoring to proactive risk prevention. AI will automate not just data analysis, but also regulatory interpretation, decision-making, and continuous monitoring across jurisdictions. Natural language processing (NLP) and machine learning models will update compliance systems as new regulations emerge. This shift will reduce human error, cut costs, and allow compliance teams to focus on strategic oversight instead of manual checks. 

Lord Philip Hammond, Ex-Chancellor of the Exchequer and Senior Adviser at RCK Partners comments, “The challenge has always been to reduce fraud and error in the R&D tax credit schemes and eliminate organised criminal activity targeting them, without undermining the positive incentive effect of the schemes for businesses undertaking eligible R&D investment. HMRC has made good progress on reduction of fraud and error, and I expect that agent identification will be an important further step, but reductions in the rates of credit payable risk disincentivising R&D investment in the UK, to the detriment of our competitive position.”