Supervisory technology (Suptech) refers to the use of technology by regulatory and other supervisory bodies to supervise, monitor and regulate financial institutions, business operations and markets.
Suptech involves the use of various automation tools, such as artificial intelligence, machine learning, natural language processing, and blockchain, to enhance regulatory efficiency and effectiveness when supervising their licence holders. This can also be a reciprocating service, as many regulated entities are using companion Regtech solutions to interface directly with Suptech solutions.
Suptech is becoming increasingly important in the financial services industry, as regulators seek to keep pace with the rapid technological changes and innovations taking place in the sector. By leveraging technology, regulators can enhance their ability to monitor and supervise financial markets, reduce regulatory burden, and promote financial stability.
The Innovation Hub is interested in Suptech solutions in the market as we start to advise on the JFSC's future data strategy and technology strategy.
The JFSC will continue to invest in this area, identifying more synergies between compliance departments and supervision. We have already developed a bespoke risk model which exemplifies the benefits of a considered Suptech strategy.
Common use cases
Suptech can help regulators and large institutions collect and analyse data more efficiently and effectively, monitor financial institutions in real time, and detect potential risks and vulnerabilities in the financial system. It can also help regulators streamline reporting requirements, reduce compliance costs for regulated entities, and improve communication.
Real time access
Useful links to topic
The Financial Stability Board's (FSB) Suptech reports
The FSB provide reports on the development of the Suptech industry