The market for generative AI (GAI) applications will grow from $6.2 billion in 2023 to $58.5 billion in 2028, with a CAGR of 56%, according to Omdia.
The total number of KYC checks for banking, conducted using AI, will reach almost 175 million globally by 2028; up from just over 23 million in 2023, according to Juniper Research. The demand for regtech solutions is increasing across not only financial services, but also industries such as healthcare and cybersecurity, as continuous verification of identities becomes fundamental in preventing financial crime and non-compliance.
One example of this is the rise of virtual GPs and ePharmacies. Here, it is vital for KYP (Know Your Patient) verification to be employed, to prevent fraud, such as identity theft and financial exploitation. By implementing these KYC verifications, businesses can avoid fines for failing to carry out customer assessments.
The report encourages cross-border businesses to adopt regtech solutions to reduce risk across different regulatory jurisdictions. As multinational companies expand into new regions, they are faced with a fragmented regulatory framework comprising jurisdictional differences across varying markets. Failure to meet compliance demands can lead to businesses facing penalties; resulting in serious economic and reputational consequences. The recent emergence of “Failure to Prevent” offenses specifically targets organizations to hold them accountable for failures in their compliance system. Implementing regtech solutions enables organizations to defend themselves from this type of allegations.
The report found that innovative vendors are using AI and machine learning to decipher email and phone call data to identify bad actors across organizations. This is vital as lawmakers and regulatory bodies are cracking down on bribery and corruption offenses, which severely undermine fair competition and contribute to slow economic growth. Juniper Research recommends that as businesses expand their operations and move into new regions, they deploy AI-powered regtech solutions to automate monitoring of regulatory compliance; reducing manual checks being required and overall risk.