Technology and innovation are transforming the global financial landscape, presenting

opportunities, risks and challenges for regulated institutions and authorities alike. A significant

area of innovation is the application of new technologies to help authorities to improve their

supervisory capabilities – known as ‘SupTech’ --- and by institutions to meet their regulatory

requirements – known as ‘RegTech’.

The opportunities offered by SupTech and RegTech have been created by a combination of

factors that have come to the fore in recent years. These include the substantial increase in

availability and granularity of data, and new infrastructure such as cloud computing and

application programming interfaces (APIs) which allow large data sets to be collected, stored

and analysed more efficiently. Authorities and regulated institutions have both turned to these

technologies to help them manage the increased regulatory requirements that were put in place

after the 2008 financial crisis.

SupTech and RegTech tools could have important benefits for financial stability. For authorities,

the use of SupTech could improve oversight, surveillance and analytical capabilities, and

generate real time indicators of risk to support forward looking, judgement based, supervision

and policymaking. For regulated institutions, the use of RegTech could improve compliance

outcomes, enhance risk management capabilities and generate new insights into the business

for improved decision-making. For both authorities and regulated institutions, the efficiency and

effectiveness gains, and possible improvement in quality arising from automation of previously

manual processes, is a significant consideration.