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Why is financial crime leading the RegTech adoption race?

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Why is financial crime leading the RegTech adoption race?

RegTech Analyst and Parker & Lawrence Research recently released a major industry report looking at the global state of RegTech in 2026. As part of their findings, it noted that financial crime solutions have the highest rate of adoption within compliance but why is that the case.

FinTech Global recently sat down with several leading players in RegTech to get their thoughts on why financial crime solutions are seeing the greatest level of adoption in the sector.

As part of the report, which can be downloaded here, it set out to bring greater structure to the fragmented market. It introduced a simplified RegTech taxonomy that covers 24 subcategories across six major risk and compliance domains. Using this framework, the report established a RegTech Adoption Index to measure relative maturity across the sector.

At the top of that list was financial crime, boasting an Index score of 68. This domain includes solutions that are designed to detect, prevent and respond to crimes impacting financial institutions, such as fraud, money laundering, sanctions evasion and terrorist financing.

Subsectors in this domain include sanctions screening, KYC/KYB, fraud prevention/FRAML, and transaction monitoring. The leading adopters of this technology are payment firms and investment banks.

The reasons financial crime solutions have seen greater adoption than other areas could come down to the fact they are an easy starting point.

Karavel CEO Pedro Sousa stated the sector has been dominated by SaaS tools over the past decade that have sought to automate financial crime workflows. As such, compliance professionals have grown accustomed to using external tooling to automate AML and KYC processes.


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