Mark Taylor
Senior Editorial Manager
Mounting regulatory pressure and a desire to move on from legacy systems are driving the adoption of AI solutions within French banks, experts from across the sector said during the inaugural RegTech Day event in Paris.
Hundreds of attendees from the biggest names in European finance flocked to Palais Brongniart recently to attend the conference organized by industry groups Finance Innovation and La Place Fintech.
Created by French Ministry of Economy and the Île-de-France Region, Finance Innovation is dedicated to the digital and sustainable transformation of the financial ecosystem. It supports innovative projects led by start-ups in the financial sector and helps major groups to identify innovation trends.
From the exhibition floor to the keynotes and roundtables, chatter was dominated by the subject of how advanced technologies can help the financial sector navigate complex regulatory landscapes.
Here are CUBE’s takeaway from the event.
1. The regulatory landscape is broadening faster than anticipated
The volume of regulations has skyrocketed in recent years. In France, the number of compliance-related issuances by regulators and government has doubled in the last decade.
Although banks have been prepared, or at least forewarned, that regulatory compliance demands are spiking, many lenders have been caught short by the pace and scale of the new rules entering force.
New challenges such as ESG, cryptocurrencies, and digital payments are prompting regulatory frameworks to expand, and forcing banks to rethink their approach to compliance.
The function must move quicker than ever, and deal with increasingly complex sets of rules.
2. Regulatory complexity requires AI-powered solutions
In the face of a cascade of regulatory obligations, it has become clear to the French financial services sector that manual processes are no longer sufficient.
As CUBE’s country manager for France, Jean-Loïc Berthet, said during a roundtable, only technology underpinned by AI has the capacity to ingest, make sense of, and ultimately update internal policies and controls in response to the compliance demands of the day.
“Whilst many of France’s big banks are using AI to monitor for regulatory changes, some of the more innovative names are implementing machine learning and automation across the entire lifecycle of regulatory change management. This doesn’t just let you stay ahead of updates, it proactively positions the compliance function to respond and reduces risks to the broader business.
CUBE’s regulatory inventory, the largest in existence today, captured more than 3,000 regulatory updates globally in August, underscoring the need for automated systems to handle the scale and complexity of these changes.
3. Real-time insights are the next frontier
During a roundtable discussion on technology's role in managing regulatory requirements, experts discussed the next wave of solutions and how they are meeting the present challenges.
CUBE’s Jean-Loïc Berthet was joined by moderator Mung Ki Woo, of Sopra Seria; Crédit Agricole’s Catherine Page; Michel Anid of BELT Solutions; Memo Bank’s Pierre Darbre; and Marie Colombier of AfterData.
The panel agreed that whilst new regulations are fast-evolving and increasingly onerous in terms of breach punishment, they are also more complex than in the past.
Regulations related to ESG, digital resilience (DORA), and payments frameworks (the incoming Third Payment Services Directive) reflect the difficult legislative terrain of the modern financial ecosystem.
Real-time regulatory tracking tools like CUBE’s RegTrend are emerging to help large complex organisations understand the nature of regulatory developments.
Going beyond capture, CUBE’s solutions understand regulatory languages and nuances, and can pull vital intelligence from issuances, in real-time. This is a huge efficiency boost for compliance teams who are presented with summaries of complex rule changes and regulatory directives.
CUBE comment
The inaugural France RegTech Day was an overwhelming success, in large part because the demand is there.
French banks, alongside developing their own, are hunting for solutions that will help them deal with the scale of the compliance challenges ahead of them.
The regulations already in force, and those to come, represent a considerable amount of information, beyond the reach of manual analysis alone.
AI and machine learning technologies have a major role to play in helping compliance strengthen the teams in charge of regulatory monitoring and regulatory change management.
To learn more about RegTrend or any other advanced AI solution in CUBE’s suite, contact us today.