RegTech and retail sourcing markets experience significant growth driven by technology

The Business Research Company has released two pivotal reports detailing significant growth trends in the RegTech and Retail Sourcing and Procurement markets. Both sectors are experiencing rapid advancements driven by technology, notably through the integration of artificial intelligence (AI) and automation.

The RegTech market is projected to expand from $13.78 billion in 2023 to $16.21 billion by 2024, yielding a compound annual growth rate (CAGR) of 17.7%. This surge can be attributed to an increasing demand for expedited transactions, heightened disposable incomes, and the rising costs associated with regulatory compliance. Furthermore, the market is expected to reach $30.04 billion by 2028, with a forecasted CAGR of 16.7%. The escalation of fraud, particularly within the financial sector, is propelling this growth. As noted in a report from LexisNexis Risk Solutions, U.S. financial services companies now incur an average loss of $4.23 for every dollar lost to fraud, marking a 16.2% rise from previous years. The growing complexity of regulatory requirements is placing an additional burden on compliance teams, further driving the demand for sophisticated RegTech solutions.

Emerging technologies such as AI, machine learning (ML), and blockchain are rapidly reshaping the RegTech landscape. Companies are increasingly incorporating these technologies to automate essential processes such as data management and compliance due diligence. Darktrace, a UK-based AI cybersecurity firm, exemplifies this trend with its introduction of an innovative autonomous response technology, which enables organisations to fortify their defence mechanisms against cyber threats while leveraging cloud technologies.

Simultaneously, the Retail Sourcing and Procurement market is also witnessing a notable increase, projected to rise from $5 billion in 2023 to $5.71 billion in 2024 at a CAGR of 14.2%. The report posits that the sector will continue on this trajectory, potentially reaching $9.57 billion by 2028, driven by the implementation of cloud-based platforms and an increasing reliance on AI and digitisation. The recent launch of innovative product offerings, such as Craft’s Risk Hub and N-Tier Mapping, indicates a proactive approach to improving supplier intelligence and risk assessment through advanced analytics.

The retail sector’s digital transformation is a significant contributor to this growth, facilitating the adoption of streamlined procurement processes. A strategic review by NASSCOM highlights that India’s technology landscape has surpassed $194 billion, propelled by a digital talent pool that has significantly expanded. This digital shift not only enhances operational efficiency but also positions retail firms to remain competitive in a rapidly evolving market.

The insights provided in these reports are critical for stakeholders looking to navigate the complex and dynamic frameworks of both the RegTech and Retail Sourcing markets. The data facilitates informed decision-making, equipping companies with the knowledge necessary to enhance their strategies within the context of increasing automation and digitalisation across industries. Furthermore, the emphasis on localising suppliers and innovating procurement solutions underscores the importance of adaptability and responsiveness in today’s marketplace.

Both sectors are indicative of a broader trend towards automation, revealing how companies across various industries are strategically implementing technology to drive growth and enhance operational efficiencies.

Source: Noah Wire Services