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RegTech is composed of the words “regulatory” and “technology”. It is a collective term for the application of modern technologies, to get the increasing regulation in the banking- and financial sector under control both from an IT and a legal standpoint.
Introduction
Attitude of the country towards RegTech-services
The climate towards RegTech-services (as for any other Fintech innovations) is positive in Poland.
The Financial Supervision Authority engages in a dialogue with entities from the FinTech sector, offering relevant clarifications to their inquiries and thus supporting the development of modern technologies on the financial market while maintaining security and adequate customer protection via the Innovation Hub Program. The program involves the Polish Financial Supervision Authority taking informative actions for the benefit of entities qualified for the program, whose activities include designing, developing or using in their business operations technological solutions on the financial market, in the area of financial market supervision and in the area of regulation (RegTech).
The program is addressed to entities planning to start operations within the part of the financial market under Financial Supervision Authority's supervision (including start-ups) that have an innovative financial product or service based on modern information technology (IT) and entities supervised by Financial Supervision Authority (planning to implement an innovative financial product or service based on modern information technology (IT).
Legal affairs
Obligations and requirements to provide RegTech-services
Under Polish law, there are no regulatory requirements for providing RegTech services as such. However, given the range of areas in which RegTech services are offered, it is impossible to prejudge whether, due to nature of the services, companies offering these services will not fall into the regulatory regime of a particular sector if they will offer services reserved for regulated entities. A customized analysis of the particular case is necessary each time.
Additional comments regarding the legal situation for RegTech-services or what RegTech’s must be aware of in this business area
N/A
Economic conditions
Market size for RegTech-services and biggest companies in this business area
The RegTech market is still in its early stages and it is difficult to assess its value, but the potential for growth seems significant. This is primarily due to the record pace of new regulations in Poland, which are hard to introduce and apply without automating the process. In 2019, 21,500 pages of new legislation were passed in Poland. This is an increase of 2.5 per cent compared to the previous year and one of the highest results in history. To read all the new legislation, in 2019 it was necessary to spend 2 hours and 52 minutes reading every working day.
Additional comments regarding the economic situation for RegTech-services or what RegTech’s must be aware of in this business area
Areas of growth for RegTech solutions and companies include fraud prevention and detection (including AML), risk management and reporting. Most regulations are created in these areas, which results in numerous obligations whose fulfilment can be automated.