Global RegTech Market Size, Share & Trends Analysis Report By Component (Solution, and Services (Professional, and Managed)), By Application, By Organization Size, By Deployment Mode, By Vertical, By Regional Outlook and Forecast, 2024 - 2031

Global RegTech Market Size, Share & Trends Analysis Report By Component (Solution, and Services (Professional, and Managed)), By Application, By Organization Size, By Deployment Mode, By Vertical, By Regional Outlook and Forecast, 2024 - 2031

The Global RegTech Market size is expected to reach $56 billion by 2031, rising at a market growth of 21.1% CAGR during the forecast period.

The Asia Pacific region's financial institutions and regulatory bodies are increasingly adopting RegTech solutions to enhance compliance, mitigate risks, and streamline operations. The growing adoption of digital banking, fintech innovations, and mobile payment systems further drives the region's demand for advanced compliance and regulatory technologies. Consequently, the Asia Pacific region would acquire nearly 30% of the total market share by 2031.

The major strategies followed by the market participants are Partnerships as the key developmental strategy to keep pace with the changing demands of end users. For instance, in November, 2023, Jumio Corporation has partnered with Suits Me Limited, a Financial Services company, to help underbanked UK customers open accounts without traditional photo ID through rapid identity verification. This collaboration streamlines account opening, providing features like cashback and multilingual personal account managers in just under three minutes. Moreover, in January, 2022, Trulioo formed a partnership with PassFort, a global provider of software-as-a-service regulatory technology solutions. Together, the companies aimed to provide enterprises to digitally upgrade KYC as well as KYB procedure, across the world. Additionally, this partnership would offer worldwide coverage and flexibility, to adapt and perform onboarding and risk observation of any product as well as any type of consumer anywhere from the globe.

Market Growth Factors

Innovations in artificial intelligence (AI), machine learning (ML), blockchain, and big data analytics are significantly enhancing the capabilities of RegTech solutions, making them more effective in monitoring, reporting, and ensuring compliance. Blockchain can facilitate secure and efficient information sharing among regulatory bodies, financial institutions, and other stakeholders, streamlining the compliance process. Hence, the advancements in AI, ML, blockchain, and big data analytics are driving the demand for RegTech.

The surge in regulations and compliance is driven by various factors, including the need to enhance consumer protection, prevent financial crimes, and ensure market stability. Regulations such as the Health Insurance Portability and Accountability Act (HIPAA) in the United States and the General Data Protection Regulation (GDPR) in Europe impose strict guidelines on handling, storing, and sharing patient data. Thus, the increasing regulatory requirements across various industries are driving the adoption of RegTech solutions.

Market Restraining Factors

While RegTech solutions promise long-term cost savings and significant efficiency gains, the initial investment required for these technologies can be substantial, presenting a significant barrier to adoption. Maintenance of RegTech systems represents another ongoing expense. Hence, the high initial costs and concerns about ROI present significant barriers to adoption.

Component Outlook

Based on component, the RegTech market is bifurcated into solution and services. The services segment procured 28% revenue share in the RegTech market in 2023. This segment includes consulting, implementation, support, and maintenance services that help businesses integrate and optimize their RegTech solutions. While technological tools are essential, their successful deployment and utilization often require expert guidance and support.

Application Outlook

On the basis of application, the RegTech market is classified into risk & compliance management, AML & fraud management, identity management, regulatory reporting, and regulatory intelligence. The AML & fraud management segment garnered 21% revenue share in the RegTech market in 2023. This segment addresses the growing need for effective tools to combat money laundering and financial fraud, which are significant concerns for financial institutions and regulators.

Organization Size Outlook

On the basis of organization size, the RegTech market is fragmented into large enterprises and small & medium enterprises (SMEs). The small & medium enterprises (SMEs) segment acquired 23% revenue share in the RegTech market in 2023. The growing affordability and accessibility of RegTech solutions, particularly cloud-based offerings (RaaS - RegTech as a Service), is driving adoption among SMEs.

Deployment Mode Outlook

Based on deployment mode, the RegTech market is segmented into cloud and on-premise. The on-premise segment garnered 42% revenue share in the RegTech market in 2023. Many businesses, particularly large enterprises and those in highly regulated industries continue to prefer on-premise deployments. On-premise RegTech solutions offer greater control over data and systems, which is crucial for organizations that handle highly sensitive information or operate in jurisdictions with strict data privacy regulations.

Vertical Outlook

By vertical, the RegTech market is divided into banking & capital markets, insurance, and non-financial. The insurance segment recorded 36% revenue share in the RegTech market in 2023. Regulatory bodies are placing greater emphasis on solvency and risk management within the insurance sector. RegTech solutions help insurers streamline compliance processes and manage risk profiles effectively. Insurance companies are constantly developing new products, which can lead to compliance challenges.

Regional Outlook

Region-wise, the RegTech market is analyzed across North America, Europe, Asia Pacific, and LAMEA. The North America segment recorded 38.9% revenue share in the RegTech market in 2023. The region's strong financial services industry and highly developed regulatory framework have created a fertile ground for adopting RegTech solutions. Furthermore, North America is home to several of the world's most prominent technology companies and startups that are at the vanguard of the development of innovative RegTech solutions.

Market Competition and Attributes

The RegTech market is fiercely competitive, driven by increasing regulatory requirements and the demand for compliance automation across industries. Key players like IBM, Thomson Reuters, and Wolters Kluwer continuously innovate to offer advanced solutions for risk management, regulatory reporting, and compliance. Emerging startups such as ComplyAdvantage and Chainalysis challenge established firms by leveraging AI and blockchain technologies. This competitive landscape fosters rapid technological advancements, making it crucial for companies to differentiate through superior analytics, real-time monitoring capabilities, and user-friendly platforms. As regulations evolve, the race to provide the most efficient and comprehensive RegTech solutions intensifies.

Recent Strategies Deployed in the Market

• Jul-2023: Wolters Kluwer N.V. introduced the CCH Integrator BEPS Pillar Two to enhance its CCH Integrator product portfolio. The new product helps multinational companies process large datasets conveniently. Additionally, the new product assists enterprises in handling sophisticated tax compliances.
• Oct-2022: Deloitte announced the acquisition of SFL Scientific, an award-winning AI strategy and data science consulting firm. The acquisition enhances Deloitte's AI capabilities for both public and private sector clients.
• Feb-2022: Trulioo took over HelloFlow, the innovative no-code, drag-and-drop builder. This acquisition aimed to propel the transportation of an improved end-to-end character platform by integrating Trulioo GlobalGateway with a complete portfolio of onboarding workflow, orchestration, and risk administration abilities.
• Jan-2022: Trulioo formed a partnership with PassFort, a global provider of software-as-a-service regulatory technology solutions. Together, the companies aimed to provide enterprises to digitally upgrade KYC as well as KYB procedure, across the world. Additionally, this partnership would offer worldwide coverage and flexibility, to adapt and perform onboarding and risk observation of any product as well as any type of consumer anywhere from the globe.
• Jan-2022: MetricStream released ConnectedGRC solutions, a solution that solves the most crucial business challenges related to risk, compliance, audit, cyber risks, and environmental, social, and governance (ESG) of the present. ConnectedGRC is powered by MetricStream Intelligence which consists of embedded best practices, deep domain capabilities, artificial intelligence (AI) powered real-time insights, and risk quantification capabilities. ConnectedGRC provides three distinct product lines with a fast time to value.
• Dec-2021: Jumio completed the acquisition of 4Stop, the leading data marketplace and orchestration hub for KYB, KYC, compliance, and fraud prevention. This acquisition aimed to integrate 4Stop's technology within Jumio's solutions to allow the enterprise to maintain the whole consumer identity lifecycle with a single, cooperative platform that would enable rapid combination and arrangement within an easy and instinctive API layer.

List of Key Companies Profiled

• ACTICO GmbH
• Jumio Corporation
• MetricStream, Inc.
• NICE Ltd.
• Thomson Reuters Corporation (The Woodbridge Company)
• Wolters Kluwer N.V.
• IBM Corporation
• Deloitte Touche Tohmatsu Limited
• Broadridge Financial Solutions Inc.
• Trulioo, Inc.

Global RegTech Market Report Segmentation

By Component

• Solution
• Services
• Professional
• Managed

By Application

• Risk & Compliance Management
• AML & Fraud Management
• Identity Management
• Regulatory Reporting
• Regulatory Intelligence

By Organization Size

• Large Enterprises
• Small & Medium Enterprises (SMEs)

By Deployment Mode

• Cloud
• On-premise

By Vertical

• Banking & Capital Markets
• Insurance
• Non-Financial

By Geography

• North America
• US
• Canada
• Mexico
• Rest of North America
• Europe
• Germany
• UK
• France
• Russia
• Spain
• Italy
• Rest of Europe
• Asia Pacific
• China
• Japan
• India
• South Korea
• Singapore
• Malaysia
• Thailand
• Vietnam
• Indonesia
• Philippines
• Australia
• New Zealand
• Rest of Asia Pacific
• LAMEA
• Brazil
• Argentina
• UAE
• Saudi Arabia
• South Africa
• Nigeria
• Rest of LAMEA