The regulatory and compliance business in Canada can expand exponentially in the next few years, but the lack of awareness, collaboration and necessary ecosystems is holding it back, say members of the regtech industry.
“Investment firms are feeling pregnant with the opportunity that technology offers,” Lori Weir, CEO and co-founder of Saint John, NB-based Four Eyes Financial told a session at the IFIC conference in Toronto on Thursday. “The problem though with this pregnancy is that nobody actually wants to give birth. Is anyone involved in a technology initiative in your organization that has given birth? The gestation period is just so long.”
Regtech, a subset of fintech, has grown to $3.7 billion globally, with the Toronto-Waterloo corridor taking a large part here in Canada. The total industry is expected to increase 23 per cent to $12 billion by 2023, said Wendy Rudd, a board member of the newly created Canadian Regulatory Technology Association.
Weir said the dream of a flourishing regtech industry is possible because of the greater role of compliance in financial services combined with the computing power of cloud-based applications and its ability to run experiments with technology partners.
But she said the regtech industry needs to become cross-functional and predictive to move forward. On top of that, people need confidence in the tools they are using, including how to preserve privacy and security.
Gregory Smith, managing director, Wealth Management Lead for Canada at Accenture, said the industry also needs a good push.
“We need a call to action… some urgency around using innovative regtech and fintech organizations to fill in the innovation gaps and the missing pieces. There are just so many conflicting priorities.”
