# RegTech – MiFID II and beyond Author: Pal Sinha, Barnali Author URL: https://financedigest.com/author/pal-sinha-barnali Published: 2018-01-13 Category: FINANCE Category URL: https://financedigest.com/category/finance Meta Title: MiFID II Call Recording and Compliance Solutions Meta Description: Learn how MiFID II will impact financial organisations and how RegTech can help achieve compliance with the new regulations. Stay informed and prepared for the Tags: featured Tag URLs: featured (https://financedigest.com/tag/featured) URL: https://financedigest.com/regtech-mifid-ii-and-beyondhtml ![undefined](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/regtech-mifid-ii-and-beyond-1736843080215-compressed.jpg) **Tom Harwood,** Co-Founder and Chief Product Officer at Aeriandi The Markets in Financial Instruments Directive II (MiFID II) comes into force on 3rd January 2018.  MiFID II will have a huge impact on how financial organisations record and archive calls that contain any type of financial advice that could result in a trade or transaction.  The Financial Conduct Authority (FCA) currently dictates that only the telephone conversations of [individuals directly involved in trading](https://www.financedigest.com/how-to-trade-forex-and-succeed-as-an-individual.html "How to Trade Forex and Succeed as an Individual") need to be recorded. MiFID II will be a [big change](https://www.financedigest.com/from-boom-to-bottom-and-now-big-change-renault-and-nissan-reshape-alliance.html "From boom to bottom and now big change: Renault and Nissan reshape alliance"). ![Tom Harwood](https://prod.superblogcdn.com/site_cuid_cm5qst7v3003gwirgwqtxn8i8/images/tom-harwood-204x300-1736843080157-compressed.jpg) Tom Harwood From 2018 onwards, conversations between the likes of [wealth managers](https://www.financedigest.com/annual-survey-of-wealth-managers-2022.html "Annual Survey of Wealth Managers 2022") or independent financial advisors and their clients will fall under the scope of MiFID II.  As well as applying to both fixed line and mobile phone conversations, the new MiFID II [regulation requires that all calls must be stored and accessible for a minimum of five years](https://www.financedigest.com/german-regulator-hands-ey-2-year-audit-ban-over-wirecard-scandal-handelsblatt.html "German regulator hands EY 2-year audit ban over Wirecard scandal – Handelsblatt") – and up to seven years in some instances. One of the main objectives of MiFID II is the pursuit of harmonised regulation across EU financial markets to ensure appropriate levels of protection for financial [services customers](https://www.financedigest.com/transforming-to-customer-centric-service-in-financial-services.html "Transforming to customer centric service in Financial Services").  This has been a continued focus for [regulators since the 2008 global](https://www.financedigest.com/be-simple-in-bank-capital-bank-of-england-tells-global-regulators.html "Be simple in bank capital, Bank of England tells global regulators") financial crash, and has precipitated growth of a new tech market: RegTech.  Regulatory Technology, known as RegTech, helps firms achieve compliance with the increasing amount of [market regulation](https://www.financedigest.com/u-s-markets-regulator-takes-aim-at-coinbase-lending-product.html "U.S. markets regulator takes aim at Coinbase lending product"). It uses information technology to enhance regulatory processes, putting particular emphasis on monitoring, reporting and compliance. **The MiFID example** RegTech will be instrumental in helping financial services [firms](https://www.financedigest.com/digital-marketing-for-finance-and-insurance-firms-is-changing-are-you-ready.html "Digital marketing for finance and insurance firms is changing — Are you ready?") achieve MiFID II compliance.  Businesses affected by MiFID II will [need to prove they are able to securely](https://www.financedigest.com/the-three-must-haves-of-cyber-security-that-you-need-to-stay-cyber-safe.html "The three “must haves” of cyber security that you need to stay cyber safe") record, archive and access a huge volume of calls. Legacy [technologies have enabled businesses to achieve compliance](https://www.financedigest.com/ethical-financial-selling-the-role-of-compliance-technology-and-sales-enablement.html "Ethical Financial Selling: The Role of Compliance Technology and Sales Enablement ") in the past, but now the pressure is on to navigate a far more arduous regulatory landscape. Today’s cloud-based RegTech call recording and archiving solutions offer a fast, flexible and scalable option to [firms that want to stay](https://www.financedigest.com/oil-prices-stay-firm-on-fuel-demand-despite-covid-19-surge.html "Oil prices stay firm on fuel demand despite COVID-19 surge") compliant.  They are often easy to implement and offer the ability to access call recordings and archives from anywhere, at any time, via a secure online portal.  This is particularly beneficial for firms that operate multiple sites or in multiple geographies, where achieving [compliance without a technology solution](https://www.financedigest.com/compliance-and-traceability-solution-market-growth-future-prospects-and-competitive-analysis-2015-to-2025.html "Compliance and Traceability Solution Market Growth, Future Prospects And Competitive Analysis 2015 to 2025") would be virtually impossible. Given the scope of new regulation that firms will need to address in 2018, including the widely [reported EU General Data Protection Regulation](https://www.financedigest.com/chinas-tencent-reports-first-revenue-drop-as-gaming-regulations-and-covid-19-bite.html "China’s Tencent reports first revenue drop as gaming regulations and COVID-19 bite") (GDPR), there will be a necessary shift towards more malleable technologies that support compliance with multiple regulations. [Since the financial crisis](https://www.financedigest.com/britains-cost-of-living-crisis-sends-sterling-to-lowest-since-mid-july.html "Britain’s cost of living crisis sends sterling to lowest since mid-July"), solutions have largely addressed specific regulatory requirements as and when they arise.  This approach may have resulted in [cost savings](https://www.financedigest.com/how-to-save-money-as-a-student-during-the-cost-of-living-crisis.html "How to Save Money as a Student During the Cost of Living Crisis") in the short-term, but as the regulatory landscape has shifted, the cost burden has risen.  Organisations now need to invest in a more robust, agile operational structure that can address changing requirements more efficiently and at a [lower cost](https://www.financedigest.com/companies-cost-inflation-is-slowing-but-shoppers-may-wait-for-lower-prices.html "Companies’ cost inflation is slowing but shoppers may wait for lower prices"). **The RegTech future** There is a [growing need for better solutions](https://www.financedigest.com/the-patient-engagement-solutions-market-to-grow-on-a-satisfactory-note.html "The Patient Engagement Solutions Market to grow on a satisfactory note") that can adapt and be modified over a shorter time-span and at a lower cost to respond to a wider variety of issues.  Newer platforms can amalgamate the [streams of information currently collected by multiple](https://www.financedigest.com/passive-income-how-to-build-multiple-streams-of-income.html "Passive Income: How to Build Multiple Streams of Income") products, and consolidate the data in a central point, where it is available to then be fed into whatever system or report as required.  When new regulations are introduced, or [changes to an existing regulation](https://www.financedigest.com/german-regulator-stays-vigilant-as-meta-changes-vr-headset-rules.html "German regulator stays vigilant as Meta changes VR headset rules") occur, the consolidation of data should allow for a faster and easier response.  This means that customer [data is more secure](https://www.financedigest.com/cyber-security-data-re-assurance.html "Cyber Security: Data ‘Re’-Assurance"), businesses have access to new insight, and companies are less likely to fall foul of financialpenalties for non-compliance. A [move towards](https://www.financedigest.com/the-orange-essential-oil-market-to-move-towards-constructive-advancements.html "The Orange Essential Oil Market To Move Towards Constructive Advancements") RegTech platforms that offer a more flexible, rapid and affordable solution should address the significant costs that continue to plague financial institutions.  It also aids firms in staying ahead of further regulatory changes in the [coming years](https://www.financedigest.com/food-fiber-market-to-exhibit-increased-demand-in-the-coming-years.html "Food Fiber Market to Exhibit Increased Demand in the Coming Years"). **Innovation in RegTech** Innovative [companies are capitalising on this need](https://www.financedigest.com/why-companies-need-to-rethink-retirement-tips-for-ensuring-a-happy-life-in-later-years.html "Why companies need to rethink retirement – Tips for ensuring a happy life in later years") for more adaptable technologies. [Last year a record £507m was invested in RegTech companies globally.](http://uk.prweb.com/releases/regtechinvestmentslondon/fintechglobal/prweb14004227.htm) London takes the top spot for the city with the most RegTech deals with [39 investments between 2012 and 2016.](http://thefintechtimes.com/london-lead-growth-regtech-investments-sector-set-soar-2017/)  The outlook for RegTech, and for London in particular, is very positive.  Compliance and regulation has always been a fragmented and inefficient area.  It presents a huge cost for banks and puts pressure on maintaining a good customer experience. As financial institutions continue to face ever-increasing regulation, accompanied by [spiralling costs](https://www.financedigest.com/spiralling-costs-could-take-greek-graviera-cheese-off-the-menu.html "Spiralling costs could take Greek graviera cheese off the menu") and complexity, they become even more receptive to new companies and technologies that can offer reliable solutions. In 2018, RegTechis poised to combat these inefficiencies and provide new, actionable insight for firms.  It will continue to [deliver results](https://www.financedigest.com/uk-pm-sunak-election-results-show-people-want-us-to-deliver-for-them.html "UK PM Sunak: Election results show people want us to deliver for them") for businesses, whilst ensuring security for consumers. --- This blog is powered by Superblog. Visit https://superblog.ai to know more. ---