PUBLISHER: TechSci Research | PRODUCT CODE: 1914527
PUBLISHER: TechSci Research | PRODUCT CODE: 1914527
We offer 8 hour analyst time for an additional research. Please contact us for the details.
The Global RegTech Market is projected to experience substantial growth, rising from USD 17.77 Billion in 2025 to USD 66.62 Billion by 2031, representing a CAGR of 24.64%. RegTech, or Regulatory Technology, involves using information technology to optimize regulatory workflows, such as compliance, reporting, and monitoring, within the financial sector. This growth is primarily fueled by the escalating costs of compliance operations and the critical necessity of using automated surveillance to mitigate financial crime. According to UK Finance, the finance industry successfully prevented over £710 million in unauthorized fraud during the first half of 2024 alone, highlighting the sector's reliance on these technologies. These drivers reflect fundamental structural changes in risk management rather than temporary technological fads.
| Market Overview | |
|---|---|
| Forecast Period | 2027-2031 |
| Market Size 2025 | USD 17.77 Billion |
| Market Size 2031 | USD 66.62 Billion |
| CAGR 2026-2031 | 24.64% |
| Fastest Growing Segment | Cloud |
| Largest Market | North America |
However, the market faces a major hurdle regarding the integration of these advanced tools with entrenched legacy systems. Embedding modern compliance software into antiquated banking infrastructure creates significant complexity, often resulting in extended implementation timelines and increased operational risks. This technical friction restricts the ability of financial institutions to rapidly scale these solutions, acting as a significant barrier to broader market expansion despite the clear operational efficiencies the technology provides.
Market Driver
The rising prevalence of money laundering, cyber fraud, and financial crimes is fundamentally reshaping the Global RegTech Market, forcing financial institutions to shift from reactive measures to advanced, automated surveillance. As criminal networks increasingly exploit complex digital channels to hide illicit activities, regulators have responded with strict enforcement and punitive actions to ensure compliance. This intensified scrutiny drives demand for robust regulatory technology capable of real-time detection. Fenergo's 'AML Fines Report for 2024', published in January 2025, notes that global regulators issued $4.6 billion in enforcement actions against financial institutions in 2024, underscoring the severe financial risks of inadequate compliance frameworks.
At the same time, the integration of Artificial Intelligence, Machine Learning, and Blockchain is revolutionizing how institutions handle regulatory obligations. Market participants are increasingly deploying AI-driven solutions to manage vast datasets, reduce false positives in transaction monitoring, and improve decision-making accuracy, moving the industry from rule-based systems to predictive analytics. According to SteelEye's June 2025 '2025 Annual Compliance Health Check Report', 68% of firms have moved AI surveillance deployments into production. Furthermore, Thomson Reuters' August 2025 'Future of Professionals Report' indicates that 80% of professionals expect AI to have a transformational impact on their work within the next five years, reflecting the sector's long-term trajectory.
Market Challenge
The integration of modern regulatory tools with entrenched legacy systems remains a formidable barrier to the Global RegTech Market's expansion. Financial institutions often rely on core infrastructures developed decades ago, which lack the flexibility to interface seamlessly with contemporary compliance software. Attempting to overlay automated reporting or surveillance solutions onto these rigid architectures leads to severe technical incompatibility, requiring extensive customization and prolonged testing that increase costs and delay value realization. Consequently, institutions often postpone large-scale RegTech deployments, fearing that the disruption caused by complex integration projects will outweigh immediate efficiency gains.
This structural rigidity effectively bottlenecks the adoption of new regulatory technologies. Reliance on outdated platforms creates a dependency that stalls the modernization efforts required for real-time compliance monitoring. In 2024, the American Bankers Association reported that 35% of banks were explicitly dissatisfied with their core technology providers, identifying these legacy relationships as their primary non-policy concern. This dissatisfaction highlights a significant infrastructure deficit; as long as institutions struggle with the limitations of their foundational systems, the scalable implementation of advanced RegTech solutions will remain constrained, directly tempering overall market growth.
Market Trends
Automated ESG Compliance Reporting is rapidly becoming a critical structural trend as the industry shifts from voluntary sustainability disclosures to rigorous mandatory frameworks like the EU's Corporate Sustainability Reporting Directive (CSRD). Financial institutions are increasingly abandoning manual data collection in favor of specialized software capable of aggregating disparate environmental and social metrics for audit-ready validation. This transition is necessitated by the massive volume of granular data required by new standards, rendering legacy spreadsheet methods obsolete. According to the Thomson Reuters '2024 State of Corporate ESG' report from November 2024, 97% of organizations now utilize third-party ESG solutions, reflecting a widespread pivot toward technology-driven sustainability governance to ensure accuracy and mitigate greenwashing risks.
Simultaneously, the convergence of RegTech and SupTech is fundamentally reshaping the supervisory landscape, fostering a symbiotic digital ecosystem between regulated entities and financial authorities. As central banks digitize their monitoring capabilities-known as Supervisory Technology or SupTech-they are establishing new data standards that compel institutions to upgrade their reporting infrastructure for interoperability. This trend moves the industry toward a data-pull model where regulators access compliance data closer to real-time, reducing traditional reporting lags. FinTech Global's March 2025 article, 'Central banks embrace RegTech and SupTech', reveals that just over half of surveyed central banks are actively using these technologies, signaling a definitive move toward digitized, data-centric supervision that demands reciprocal technological maturity from the private sector.
Report Scope
In this report, the Global RegTech Market has been segmented into the following categories, in addition to the industry trends which have also been detailed below:
Company Profiles: Detailed analysis of the major companies present in the Global RegTech Market.
Global RegTech Market report with the given market data, TechSci Research offers customizations according to a company's specific needs. The following customization options are available for the report: