New data from Juniper Research forecasts that spending on regulatory technology will rise from US$25 billion today to $127 billion by 2024 thanks to a dramatic rise in the automation of resource-intensive tasks, especially the increasing use of artificial intelligence in transaction monitoring.

According to the research, AI is ideally suited for regulatory tasks as it can reduce false positives in number and false negative rates. As a result, compliance departments at financial firms stand to save time and therefore money when monitoring activity.

Juniper does not anticipate any relaxation of regulatory rigour over the next five years and expects financial penalties for non-compliance with regulations to carry on sky-rocketing. It believes that global regulatory compliance spending will increase from just under $278 billion today to more than $316 billion in that period. It forecasts that the growth of RegTech will be all the more rapid in Western Europe because of the divergence in regulatory rules that will happen when the UK finally gains its independence from the European Union.

The research giant goes on to predict that the combined cost savings for know-your-customer or KYC checks for banking and property sales will near $1 billion by 2024 - a growth of 690%. It expects HNW customers to have a far better time during the onboarding process by the end of the period.