Why Is Ireland Synonymous With RegTech?
This is a question that comes a lot and one that I was recently asked when presenting to the Japanese regulator in Tokyo.
The Japanese were really intrigued to work out and understand how a small country like Ireland, is so well positioned to have so many indigenous RegTech companies and indeed FinTechs, given that Japan has a population of over 125 million people, compared with a population in Ireland of just under 5 million.
There are a number of unique factors and circumstances that all align together to rank Ireland as a global leader in this space and I hope to give you a short overview of my views on ‘Why Ireland is synonymous with RegTech’.
Ireland has been named by Forbes as one of the best countries in the World to do business in.
If we take the Irish Fund industry as one example, this one being close to my own heart, having spent over 10 years working in the industry before joining GECKO Governance early last year, Ireland’s Fund Industry is one of the biggest and best ranked in the World.
In 2019, Ireland was ranked the 3rd largest investment fund global centre in the world and 2nd largest in Europe and Enterprise Ireland confirmed that in 2020, 250 of the World’s leading financial firms, including half of the world’s top 50 banks have internationally focused operations in Ireland.
This fund friendly environment has been grown and developed in Ireland over 30 years — with a favorable legal and tax framework, a wide choice of expert service providers, 40% of global hedge fund assets are serviced in Ireland — making Ireland the largest hedge fund administration center in the world and indeed Europe’s leading hedge fund domicile adding to this unique ecosystem.
This leading global expertise has led to a natural transition of funds experts moving into the RegTech sphere and the fact that so many global financial services companies have an Irish base and an Irish operation has been fantastic for us as a company — it is much easier to build a relationship with the Irish office of a firm and we can then implement our solution into an Irish branch, and roll it out globally to other branches over time.
If we set aside the financial services industry and look at Ireland’s technology industry, Ireland benefits from having an exceptional selection of international players with their European bases here. Ireland is home to 9 of the world’s top 10 technology companies; including Facebook, Google and Amazon, which has enabled Ireland to have an exceptionally skilled tech work force.
Feeding into the workforce is a constant flow of new talent. Ireland has an exceptionally quality education system and a plentiful supply of highly qualified people and in 2019, Ireland was ranked №1 in the World for skilled labour for attracting and retaining talent.
When visiting Tokyo, the Japanese Regulator and indeed all of the many large multinational companies that we visited were really impressed with the work of Enterprise Ireland and indeed the IDA Ireland.
Government agencies are not universally renowned for this level of support and Enterprise Ireland and the IDA Ireland have without doubt contributed greatly to Ireland’s successful indigenous RegTech providers.
All of what I have just mentioned, coupled with the unique collaboration culture in Ireland — collaboration with technology, financial services industry experts and indeed the unique support offered from the Irish Government and Government agencies, really creates a unique opportunity for continued Irish RegTech success.
Technology is an enabler — there is so much new technology available to the Financial Services industry, but we find that the industry has not yet fully grasped how best to deploy it. The future is here but it is not evenly distributed yet.
We have highly skilled people completing mundane tasks that can and should be automated and it is important to note that RegTech and indeed technology in general, should not be seen as intended to replace jobs, but to enhance operational efficiency. The deployment of technology will lead to the quality of jobs improving to make them more interesting for those completing them.
This has been very much the experience at GECKO Governance, a RegTech system for financial institutions, providing definitive solutions to meet all compliance pain-points, across a multitude of financial service areas on a global basis.
Gecko Governance was born out of the frustration of running large scale compliance projects across multiple jurisdictions on excel spreadsheets. When asked who our biggest competitor is, to this day, it remains excel spreadsheets.
Gecko’s 3 Click Concept enables a greater focus on substance and resources, and allows firms to effectively manage their regulatory oversight, outsourcing and requests from regulators.
To summarise, Regtech growth in Ireland looks set to continue, with Brexit adding its part to the growth with more and more UK financial services firms relocating their business operations to Ireland.
Covid-19 will also accelerate the RegTech update — the need for automation, increased remote working and really that cockpit of compliance that GECKO offers adds real value to processes.
Ireland has set itself up as a global base for RegTech firms and I think this will continue over the coming years, with Ireland positioning itself as a hub and centre of excellence for global RegTech.
Elizabeth McKeever, Head of Operations.
References:
2020. Why Ireland. [ebook] Irish Funds. Available at: <https://irishfunds-secure.s3.amazonaws.com/1591780037-2020-06-Irish-Funds-Why-Ireland-EU-2020_June.pdf> [Accessed 10 June 2020].
The Irish Times. 2020. Fund Management Regulations Bring Excellent Opportunities For Regtech Firms. [online] Available at: <https://www.irishtimes.com/special-reports/irish-funds-industry/fund-management-regulations-bring-excellent-opportunities-for-regtech-firms-1.4147728> [Accessed 10 June 2020].
