Powering Through Finance Transformation: Highlights from the London RegTech Forum

The iconic Guildhall's Old Library recently hosted our esteemed annual RegTech Forum, organised in partnership with the City of London Corporation. This prestigious gathering convened a select panel of experts from leading banks, building societies, the tech industry, and regulatory authorities. The forum's objective was to illuminate recent transformations in the finance and banking sectors. The concluding session this year was the profound discussion on "How to Power Through Finance Transformation," which provided invaluable insights into the future trajectory of the financial sector in an era of rapid technological evolution. Leading this conversation were industry experts: Edward Bowles, Former Global Director of Public Policy at Meta; Robert Swales, Senior Architect at Nationwide Building Society and Angus McLean, Partner and Head of FinTech at Simmons & Simmons; with Diana Paredes, Suade CEO, steering the discussion as moderator. 

In an era marked by swift technological advancements, evolving regulatory landscapes, and dynamic market shifts, the imperative for finance transformation has never been more pronounced. The panelists emphasized the critical role of this transformation in ensuring organizational resilience during these turbulent times. Central to the discourse was the idea of re-envisioning finance processes, harnessing the potential of digital innovations, and tapping into the power of data analytics. The trajectory of this transformation, as highlighted by the panellists, is intrinsically linked to an organization's risk appetite. This appetite delineates whether institutions position themselves as risk takers or makers in the transformative journey. A thought-provoking projection was shared: in the near future, automation could potentially subsume 80% of jobs, rendering the banking landscape virtually unrecognizable.  

Machine Learning (ML) and Artificial Intelligence (AI) were spotlighted for their undeniable advantages. Observing successful implementations of these technologies in other firms can serve as a catalyst for others to take the transformative leap. However, costs remain a formidable barrier for many institutions. To navigate the complexities of internal change, the panellists emphasized the indispensability of robust governance and effective communication. Setting realistic expectations, ensuring clarity on timelines, and fostering a comprehensive understanding of the transformational roadmap are paramount. One panellist astutely remarked on the inherent risk of failure in technological endeavours. Yet, this risk isn't necessarily detrimental. Failures can offer invaluable feedback, paving the way for product enhancements.  

The ripple effects of Facebook's Libra were discussed, highlighting its role as a catalyst for innovation in both the public and private sectors. On the regulatory front, initiatives like MICA exemplify how innovation is steering regulatory transformations. However, a recurring sentiment was that regulation often lags behind the curve of innovation. The dual role of regulators was emphasized: not just as framers and enforcers of rules but also as entities that incentivize firms towards innovation.  

The UK's supportive ecosystem for technological advancements was lauded. The existence of regulatory sandboxes allows firms to experiment, derive insights, and disseminate their findings. In this transformative era, the ability to swiftly acquire knowledge on novel subjects and upskill is crucial. A robust data strategy was underscored as the bedrock for firms. While AI promises transformative potential, its efficacy is contingent on organized and streamlined data.  

The term "transformation" might evoke notions of vast, intimidating change. However, the panellists advocated for a more nuanced perspective. Transformation is a continuous journey, and when broken down into its constituent parts, it becomes intuitive and manageable. The concluding note was one of encouragement: institutions should be primed for experimentation and potential failures. Embracing change, rather than fearing it, is the way forward. 

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