Regulatory technology (RegTech) – the new foundation of digital compliance
Regulatory technology, or RegTech, has moved from a niche innovation to a core component of financial compliance strategy. In an era of rapid regulatory change and constant scrutiny, traditional manual compliance methods are no longer sustainable.
RegTech gives institutions the ability to detect risk, manage obligations, and prove compliance in real time — all while meeting increasingly complex requirements under AMLD6, DORA, and PSD2.
For financial leaders, this is not just about cost reduction. It’s about building a compliance infrastructure capable of scaling with regulation, without exposing sensitive data or creating new operational vulnerabilities.
For financial leaders, this is not just about cost reduction. It’s about building a compliance infrastructure capable of scaling with regulation, without exposing sensitive data or creating new operational vulnerabilities.
Why RegTech has become essential
Financial institutions operate under constant regulatory flux. Directives from the European Banking Authority (EBA), FATF, and European Commission evolve faster than most organizations can manually adapt to.
RegTech addresses this through automation, data integration, and continuous monitoring. At its core, RegTech enables institutions to:
RegTech addresses this through automation, data integration, and continuous monitoring. At its core, RegTech enables institutions to:
- Automate regulatory reporting and suspicious activity submissions.
- Monitor transactions and risk indicators in real time.
- Integrate AML, CTF, and fraud detection systems across jurisdictions.
- Maintain a complete audit trail for supervisory review.
This automation frees compliance teams from repetitive reporting and allows them to focus on interpreting results and managing high-value risk.
How RegTech transforms compliance operations
In the past, compliance processes were fragmented across departments and systems. RegTech unifies these workflows through intelligent analytics, secure data pipelines, and continuous monitoring.
Key transformations include:
Key transformations include:
- Real-time compliance: instant monitoring of customer behavior, transaction anomalies, and sanctions breaches.
- Dynamic risk profiling: adaptive scoring models that evolve with customer and market data.
- Automated reporting: standardized submissions to FIUs and regulators that meet EBA and FATF expectations.
- Integrated fraud and AML systems: seamless data exchange between fraud, AML, and KYC teams to reduce duplication.
- Predictive analytics: forecasting emerging threats using behavioral and network data.
This shift turns compliance from a reactive cost center into a forward-looking intelligence function.
The link between RegTech and regulatory resilience
The Digital Operational Resilience Act (DORA) connects RegTech directly to operational risk management. Institutions must now prove that their compliance technology is resilient, secure, and able to recover quickly from incidents.
Under DORA, financial organizations must:
Under DORA, financial organizations must:
- Identify critical ICT service providers and manage outsourcing risk.
- Maintain continuous monitoring of compliance systems.
- Demonstrate integrity and traceability in all data-driven compliance processes.
This makes RegTech a resilience enabler — not just a compliance tool.
“RegTech has shifted compliance from human process to machine intelligence. It’s no longer about checking boxes; it’s about ensuring systems can anticipate, explain, and withstand regulatory scrutiny.”
- William Morris, Lead Enterprise Account Executive - UK
This captures the strategic view now dominant among senior leaders — compliance is infrastructure, not administration.
Challenges in RegTech adoption
While adoption is accelerating, many institutions face barriers that go beyond technology itself.
Common challenges include:
Common challenges include:
- Integration gaps: legacy systems lack interoperability with modern RegTech APIs.
- Data governance: regulatory reporting requires accurate, standardized data sources.
- Privacy compliance: cross-border monitoring often conflicts with GDPR and data localization laws.
- Vendor oversight: financial institutions remain accountable for third-party tools under DORA.
RegTech and the future of financial compliance
RegTech is rapidly becoming the connective layer between all forms of compliance: AML, fraud detection, cybersecurity, and operational resilience.
The next stage of RegTech will depend on three capabilities:
The next stage of RegTech will depend on three capabilities:
- Federated intelligence: allowing collaboration without centralizing data.
- Explainable AI: providing transparency into how compliance models make decisions.
- Privacy-preserving computation: ensuring secure analytics across distributed datasets.
These capabilities are what regulators increasingly expect under the EBA Guidelines on Financial Crime Risk and FATF Recommendations — measurable outcomes supported by verifiable, secure data.
Partisia’s RegTech solutions
RegTech’s promise depends on trusted data collaboration — but sharing compliance data across institutions remains restricted by privacy law. Partisia’s privacy-preserving data collaboration platform bridges this gap.
Using Multi-Party Computation (MPC), financial institutions can:
Using Multi-Party Computation (MPC), financial institutions can:
- Run joint AML and fraud detection models without revealing raw data.
- Verify compliance metrics collaboratively with regulators.
- Improve detection accuracy while maintaining full GDPR and DORA compliance.
This makes Partisia a natural partner for the next generation of RegTech — one built on privacy, integrity, and interoperability.
