Onfido, the identity verification provider, has launched the Regtech Principles for Innovation to encourage greater collaboration between regulators and financial services. Aimed at building an inclusive financial ecosystem that protects consumers and businesses alike, the Principles encourage the use of new technologies to empower digital innovation.
Responding to the new opportunities and corresponding challenges of the mobile economy, the RegTech Principles for Innovation champion the use of regulation technology (RegTech) to open up digital innovations in financial services to more users, while reducing the risk to business from identity theft, fraud and money laundering. With the ability to convert complex regulation into simple code and provide a trusted digital identity for online users, RegTech enables businesses to easily comply with their regulatory requirements even as volumes of users scale. It could be instrumental in extending financial services to the 2 billion un- or under-banked worldwide, as well as reducing the $1.9 trillion in regulatory costs that businesses in the US pay each year.
A leading proponent of RegTech, Onfido was founded in 2012 by three new graduates from Oxford University. Since then, the company has experienced rapid growth, receiving over $30 million in funding, and now offers its Machine Learning-based Know Your Customer (KYC) and Anti-Money Laundering (AML) solution to financial services around the world.
The Regtech Principles for Innovation were launched following recent proposals to repeal the 2010 Dodd-Frank Act, and the surrounding speculation over its continued role of regulation in financial services. Rather than deregulate the industry entirely, the Regtech Principles for Innovation propose using available technological solutions to refine its application to new, digital environments.
Husayn Kassai, CEO at Onfido, said: “We believe that RegTech - and these Principles for Innovation in particular – are the key to building relationships of trust between regulators, businesses and consumers. While RegTech has seen strong uptake in some sectors of financial services, others have been slow to innovate and will struggle to stay competitive as regulation increases. With RegTech, businesses can take advantage of the opportunity available to them whilst complying with the regulation that protects their consumers – it’s a win-win that could be enormously beneficial for our economy at large”.