James Saunders
Tool sprawl has become a major challenge for financial services institutions (FIs) after years of buying disparate, single-function Regulatory Technology (RegTech) solutions. Today, many compliance teams are struggling with siloed data and inefficient workflows because of the lack of integration across tech stacks that have become unwieldy and difficult to manage.
But we believe that this will change in 2026 as FIs rethink how they use technology. We foresee a shift to a ‘less is more’ mindset. Many Fis are looking at how they can rationalise existing solutions and intelligently consolidate them into one ecosystem. They are not just scrutinising technology platforms but also looking at how they can standardise regulatory processes to achieve the efficient controls that RegTech has always promised.
Patching over individual problems
New regulations have a dramatic impact on business operations when they are introduced. They do not just affect governance and risk reporting, but also raise challenges in data security, company culture and ethics, and sustainability protocols. Businesses need to adapt systems and processes fast when new laws and regulations are introduced to simplify red tape and avoid fines and other penalties.
Many organisations have responded to new anti-money laundering’s (AML) requirements by adopting ad hoc solutions over the years. The resulting environment, comprising multiple layers of apps and systems – is not fit for the purpose of efficiently processing and managing huge volumes of customer and transaction data. Little wonder 90% of businesses think ongoing regulatory shifts complicate maintenance of IT systems.
The effects of ‘RegTech bloat
Many FIs are today manually reconciling fragmented platforms, data, and workflows, despite the significant investments they have made into technology. These efforts waste hours for the average compliance team, exacerbating the perception of compliance technology as a cost centre rather than a way to drive innovation. Compliance and IT teams alike are frustrated by disconnected systems and training fatigue.
Business leaders and CFOs, meanwhile, want to know where the ROI is when compliance costs are still rising despite heavy investments in automation. Supervisory checks demand end-to-end auditability for AML protocols. Poor quality makes this impossible, even after Fis have scrambled to adopt and train advanced AI models for investigative purposes. It clear that Fis need a better way forward when buying more tools is out of the question.
Step One: Technical merging
FIs should thus focus on making RegTech work better for them in the following ways:
· FIs should seek providers that are able to integrate preexisting KYC/AML data pipelines. This will enable them to merge overlapping workflows into a modular, interoperable platform that can adapt to future needs.
· Unifying a compliance function with flexible, end-to-end architecture creates a single source of truth for compliance teams that spans onboarding to investigations to reporting. Duplicated work is eliminated and automation reduces manual inefficiency, human error and false positive rates.
· Streamlining processes involves redesigning workflows around shared data models. All areas of AML compliance are connected, including initial onboarding, sanction screening and ongoing monitoring.
· Proving ROI for every tool within an AML stack is crucial. Metrics such as onboarding times, case closure hours, false positive reductions and audit readiness demonstrate accountability for RegTech investments.
Step Two: The leadership imperative
Platforms and people complement each other’s success in AML compliance. Humans will take the lead in consolidating RegTech platforms and instilling a top-down compliance culture and a connected mindset around AML protocols. Within this shift, compliance leaders should be proactive in assessing the functionality of individual services as part of the overall tech stack.
When building integrated ecosystems, there should be greater effort to remove arbitrary features, ineffective measures and outdated vendor partnerships as well as to align procurement, technologists and investigative teams on shared goals. This oversight must consistently link ROI to past audits, which becomes easier when customer and transaction data in the RegTech system is fully connected and in use.
FIs understand they need stronger ecosystems built on cooperative platforms and people. But these should enhance rather than replace solutions in which they have already invested. Compliance will improve not by adding more tools, but by following a clear plan that builds a system with better alerts, smarter checks and useful insights that help deliver faster, evidence-based reports to stop financial crime.
A multidimensional RegTech ecosystem
We are seeing large institutions move toward partnership-based procurement, where multiple vendors collaborate to deliver a unified compliance base. With cloud-based features added to existing architectures and automated tools integrated through a strategic co-vendor, the platform becomes interoperable. Such a setup also supports a reliable, ongoing partnership that helps bring clarity to a historically over-complex compliance landscape.
This is less about competition or who owns the platform and more about who can make it work for the client. Real progress involves sharing intelligence and jointly building out forward-looking AML that is fit to scale with regulatory shifts and growing customer volumes.
About RelyComply
RelyComply empowers banks, insurers, financial services providers, and innovative fintechs with a single, fully integrated KYC and AML platform. Designed for seamless implementation and rapid deployment, our intelligent technology enhances efficiency while detecting financial crime, enabling you to reduce risk and costs, ensure compliance, and drive strategic growth.
James Saunders, Co-founder and CTO at Anti-Money Laundering (AML) platform RelyComply.He writes in his personal capacity.
