Alloy's Annual State of Compliance Benchmark Report 2023

Looking at compliance trends in 2023 and making predictions for 2024

Navigating the increasingly complex global regulatory compliance landscape has become more and more challenging for financial institutions of all types and sizes. Even fintechs that are not currently being regulated are often contractually obligated to comply with regulations through their sponsor bank. For many fintechs, remaining compliant with these regulations can be a confusing and onerous task.

Meanwhile, regulators have been taking a closer look at fintech over the past few years — a trend that is likely to continue and even accelerate. As burdensome as it may seem, fintechs can’t afford to make mistakes on compliance, or they risk hefty fines, being shut down by regulators, and even prison sentences.

So, how are leading fintechs reacting to the rapidly evolving regulatory landscape? Alloy surveyed more than 200 compliance decision-makers at fintechs ranging from startups to some of the world’s largest companies to find out.

Key findings

  • 93% of fintechs said it was challenging to meet compliance requirements

  • Over 60% of fintechs paid at least $250K in compliance fines in the past year

  • More than half (55%) of fintechs said that a lack of automation is their biggest barrier to meeting BSA requirements. To address this need, 53% of fintechs are using a third-party platform to manage their compliance.

  • 84% of fintechs are using or exploring AI/ML to help them meet compliance requirements

The survey was conducted by Qualtrics, a leading survey platform that powers +1B surveys every year.

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