The emergence of new technologies reminds me of 1996 when the Internet was about to hit massive adoption.
What is the difference between regtech and fintech? Regtech is a much broader term that applies to many more industries beyond banking.
I read an interesting article recently in FinRegAlert: Fintech, Regtech and the Role of Compliance. In it the author points out the tension between the drive to adopt new financial technologies and complexity added by new regulatory requirements. The article is a good summary of the information published by Thomson Reuteurs which can be dowloaded here. However, I do think it misses a key point in that the new regulatory requirements are an EXPONENTIAL increase in complexity which will never be fully addressed by incremental regtech.
Exponential problems are difficult if not impossible to get under control and trying to solve these problems wtih linear solutions (more storage, processors or deploying more people etc.) is a fool's errand that can add unbounded cost. The solution is exponential regtech!
Here at Trust Exchange we are working to solve these problems by bringing exponential technologies to the sharp edge of these challenges. For instance, we are using crowdsourcing to solve the data collection problem inherent in most regulatory requirements. Like Facebook collect information from the edge, compile it and present it in clear and actionable ways.
If you wold like to learn more, CONTACT US for more information.
The value and scale of Peer to Peer (P2P) networks is well known. There are several examples of very successful uses of this framework including Skype, Kazaa, Napster etc. The emergence of “social” software and web 2.0 infrastructures is largely based upon the core analogy of P2P. At TrustExchange, we are building the first P2P Risk Assessment Platform which will leverage this model to enable businesses to obtain a more accurate view of risk inside their operating ecosystem (customers, vendors and partners). Our goal is to be the "waze" of business information.
To gain a better view of what we’re up to, it may be helpful to first discuss the core idea behind P2P networks and then expand on how it applies to risk analysis. First, the definition, from Wikipedia, of Peer to Peer networks:
“Peer-to-peer (P2P) computing or networking is a distributed application architecture that partitions tasks or workloads between peers. Peers are equally privileged, equipotent participants in the application. They are said to form a peer-to-peer network of nodes.”
Note the part about peers being “equally privileged, equipotent participants,” and you’ll understand the core idea behind TrustExchange's approach. We’ve noted previously how the existing b2b credit granting and credit management process is broken. And we believe these processes can be greatly improved by creating a P2P, open and transparent risk analysis platform where the data is created and maintained by the peers participating in the network.
Currently, the data used to assess the credit worthiness or viability of a given company is maintained and controlled by the large credit bureaus such as Experian and Dun and Bradstreet. These bureaus are fundamentally middle men with limited value since they don’t grant or issue credit. Businesses make the credit decisions themselves and need a better tool that is more accurate, timely and correlated to viability.
Wouldn’t it be better when analyzing the risk of a given company, if you could not only look at their payment history, but examine how they perform in all aspects of their business? A global risk assessment which takes into account how they perform as a customer, vendor and partner?
Wouldn’t it be valuable to not only look at a single company but view an entire portfolio of customer risk, vendor risk and partner risk?
This is what we are creating at TrustExchange. If you think this is valuable and have strong opinions on the issue sign up now and participate in the discussion and give your input into the development process.