How MAP FinTech is riding the rising RegTech wave

Founded in 2013, MAP FinTech is now one of the older companies in the RegTech sector. The company is a provider for the financial services industry and specialises in reporting solutions from the requirements of a range of complex international regulations.

Being one of the earlier innovators in the RegTech space, the company has seen a flurry of new companies arrive on the market to compete for top spot. What sets MAP FinTech apart from its competitors?

“MAP FinTech is at its best when matching technology and compliance”, states Panayiotis Omirou, who is CEO at the company. “This combination has allowed us to deliver successful RegTech solutions for the regulatory industry and differentiate ourselves from the competition.”

All of MAP’ FinTech’s solutions are offered under its Polaris platform, which is a centralised tool that allows for the configuration, management and monitoring of all of the firm’s RegTech products through a single, user-friendly online portal. The company’s solutions use existing client data sets to deliver a seamless reporting vehicle that guarantees transparency and efficiency.

Omirou continued, “Plenty of our success stems from our ability to combine the work being carried out by both our compliance and technology divisions in an effective and agile manner. This teamwork has allowed us to better cater to the rapidly changing demands posed by the global RegTech world. It has also made it easier for us to provide our clients with fully customizable and targeted solutions that cover all their reporting needs. This flexibility and ability to quickly adapt to a dynamic regulatory environment, matched with our unwavering commitment to customer service and innovation, has allowed us to be one step ahead of the competition.”

RegTech rise

The demand for RegTech has expanded massively in recent years and is only expected to grow further. Research earlier this year predicted the industry would grow from a value of $7.6bn in 2021 to $19.5bn by 2026. With this in mind, why has the demand for RegTech exploded so suddenly?

According to Omirou, demand for RegTech solutions is not new. He said, “In terms of trade level reporting, this market is rather mature with regards to MiFIR and EMIR. Nevertheless, the emergence of firms using regulatory technology for trade surveillance and monitoring functions has grown.

“For instance, as a result of Brexit and the pandemic, organisations are looking to automate solutions and ease staffing costs. Brexit has also drawn attention to firms now operating under a different set of regulations. Reporting requirements for firms that want to operate in both the EU and the UK have become more stringent as the FCA and ESMA have naturally diverged. Besides this, the individual position of each regulatory body in continental Europe has had a dramatic effect on their ability to attract companies into their areas of control. Hence, regulatory arbitrage has become a legitimate concern.” 

Shifting winds  

In an age where the changing of trends is constant and new challenges abound, financial services companies are finding it increasing tough to handle the changing regulatory positions. MAP FinTech are working very closely with these companies – how do they think financial services firms are handling it?

Omirou remarked, “They are taking it seriously in light in geopolitical movements in Europe. Currently, there are two things to be aware of when it comes to participating in those very markets. The first is that implementing solutions that are transparent is paramount. Secondly, companies now want to achieve those high levels of accuracy that had previously been deemed unattainable, be that due to paucity in reconciliation options available or via the deployment of AI in a feasible and useful way.”

For MAP FinTech, what are the key trends in the RegTech industry right now? According to Omirou, one of the many contentious topics in RegTech right now involves the best way to manage money laundering put in practice strong AML regulations.

He detailed, “I believe RegTechs are well positioned to provide solutions to AML issues due to their operational efficiency. Regulatory technology, and in general RegTech firms, guarantee increased efficiency by streamlining the process and tasks that need to be done for identity proofing, identity resolution, ongoing AML screening and monitoring, as well as transaction monitoring. Tech companies that are focusing on the regulatory side of business acquire the knowledge and expertise need to resolve complex regulatory challenges that cannot be handled manually.”

Omirou stated that RegTech has shifted from being a best effort to adhere to the spirit of the current rules to the more comprehensive endeavour of being as accurate as possible. He stated that it is a ‘fact’ that Brexit has polarised both European and UK regulators into a position of co-opetition’ whilst attempting to make their specific markets more attractive to outside investment.

He continued, “Jurisdictions across the region must try to show probity with regards to their own regulatory rulings. At the same time, however, they should not make these same rules a barrier to trade or entry. As such, one can see that there is a balance to be struck.” The MAP FinTech CEO gave the example of the usefulness of RTS27/28 as one example of this conundrum.

Omirou commented that current trends involve accuracy – more specifically – what is required to show your workings in the reconciliation world, while retaining oversight on a fully transparent workflow. He claims this will affect trade level reporting for the former and trade surveillance for the latter. In turn, Omirou remarks, this will bring about the implementation of systems that can adapt to future regulatory changes – whether this is the refit of EMIR or the natural divergence between the EU and the UK.

What will be the hottest topics during 2022? Omirou cites ‘in-house expertise, robust processes and full reconciliation tools’ as the areas to watch out for.

Pandemic effects

One of the biggest and obvious effects of the pandemic was the great migration to the online world. This, while positive in some areas, also provided big challenges for companies that were not as strong digitally and were not fully in-tune with how to ensure regulatory compliance in a digital world.

How has the pandemic changed the regulatory compliance space? Omirou emphasises, “The pandemic further exposed the need for tech solutions that offer streamlining and cost-saving initiatives with rapid deployment. This new reliance, which has undermined and disrupted the status quo, has become essential for organisations to adapt and remain compliant.”

The pandemic knocked a lot of companies off a path of stability and led to the vast uprooting of many companies to the digital world more predominantly. Many businesses were ill-prepared for the pandemic, especially in the area around digital.

Omirou echoed this sentiment, stating, “Whereas most industries were caught off-guard by the constraints imposed by the pandemic, the RegTech sector has continued to pioneer and revolutionize the control functions of companies through its Regulatory-as-a-Service (RaaS) solution, successfully bridging the gap between the technology and compliance reporting burdens faced by companies.

“The ability to offer a holistic cloud-based service, which is both dynamic and scalable, and further enables the successful navigation of regulatory compliance mandates, has been paramount to the growth of the RegTech industry.”

Future goals  

What are the plans for MAP FinTech’s future? With the industry in large part now taking stock of the new and exciting opportunities that are arising post-pandemic, all is to play for going forward in the sector.

Omirou detailed, “MAP FinTech is using this time to tackle complacency by strengthening its offering. We are currently working on refining our product offering and reviewing our existing solutions. I think a lot of vendors become complacent with what they have built and, if this year has shown us anything, it’s that circumstances and regulator stances change regardless of market sentiment.

Vendors must constantly ask themselves whether their solutions and business model are both relevant and correct, and the messaging around such is “en-vogue” with its existing and future client base.  That said, we are currently building out a more robust reconciliation process for institutions, as well as defining our compliance oversight services that complement our technology stack. There is no point in offering a client a “state-of-the-art reporting tool” without them understanding the fundamentals of what this is helping them address.”

MAP FinTech has recently expanded its partnership with UnaVista and the Depository Trust and Clearing Corporation. Omirou noted MAP FinTech is ‘extremely happy’ with its partnerships so far and is seeing positive outcomes as a result of its collaboration with both organisations.

Omirou concluded, ”We are always observing the market and possible partnerships to develop. The question of organic vs. inorganic growth through partner, joint venture or acquisition is one of timing and market requirements. As a result, we are in discussions with several market participants over future potential collaborations.

“Lastly, we will introduce new client support technologies to improve the efficiency and quality of the two most important processes in RegTech projects: initial onboarding and day-to-day support.”

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