REGnosys flags 2026 regtech surge as London faces rivals

REGnosys has set out its expectations for a further wave of regulatory reporting change in 2026, alongside a more competitive landscape for London as a fintech and regtech hub.

The regulatory technology firm said reporting rule rewrites across major markets have created new demands on firms and increased the focus on standardised approaches to compliance.

London outlook

REGnosys pointed to growing investor and government interest in regulatory technology, alongside a broader contest between financial centres for fintech innovation.

"RegTech offers a huge growth opportunity for all financial hubs, with the global market expected to reach $85 billion by 2032 as the need for smarter compliance solutions is only growing. Firms increasingly recognise that investing in RegTech is not just about meeting regulatory obligations, but also about reducing risk, improving operational efficiency, and unlocking strategic value," said Leo Labeis, CEO, REGnosys.

The comments frame regtech as a segment with its own growth curve, even as fintech funding and company formation have shifted across regions in recent years. London remains one of the largest global centres for finance and technology, though competition has intensified from other hubs in Europe, North America, the Middle East and Asia-Pacific.

"London has long been a global fintech hub, but recent trends show a mixed picture for the sector. While the City remains close to New York in overall financial centre rankings, other hubs are catching up in fintech innovation. With targeted government support, the UK can scale home-grown RegTech innovations, maintain its competitive edge, and secure its position at the forefront of global fintech," said Labeis.

Reporting rewrites

REGnosys also highlighted the scale of regulatory reporting change across multiple jurisdictions. It said firms have faced overlapping programmes of reform that affect derivatives, securities financing and other reportable activity.

"Over the past two years, major regulatory rewrites across Hong Kong, Canada, the U.S., Europe, the UK, Japan, Australia, and Singapore have challenged reporting firms worldwide. This is expected to continue into next year with further updates expected from the CFTC, SEC, ESMA and FCA," said Labeis.

Market regulators have aimed to improve data quality and comparability in transaction reporting, particularly after years of concerns about inconsistent reporting and limited usability of data. Cross-border activity in derivatives and securities financing adds to the burden, as firms often need to meet multiple regimes with similar but not identical requirements.

REGnosys argued that the reforms share a common direction of travel around alignment and greater transparency, even though implementation varies between regulators.

"These reforms are implementing initiatives to harmonise reporting standards across the G20 and improve market transparency. While increasing compliance demands, they have also accelerated RegTech growth, underscoring the need for firms to adopt digital, standardised solutions that enhance reporting quality, reduce operational risk, and turn regulatory obligations into strategic advantage," said Labeis.

Rising complexity

The firm also drew attention to operational friction created by complex trade lifecycle reporting and by regimes that require both sides of a transaction to report and reconcile.

"Regulatory complexity continues to rise. The need to report complex lifecycle events increases the risk of inconsistent interpretations for firms. Dual-sided reporting requirements like SFTR or EMIR compound the problem by adding costly reconciliations. These challenges highlight the need for mutualised, standardised approaches to reporting and demonstrate why legacy, siloed systems are no longer sustainable in today's fast-moving financial markets.

"Digital Regulatory Reporting (DRR) and the Common Domain Model (CDM) have successfully transitioned from experimental pilots to operational adoption across multiple jurisdictions. By standardising inputs and coding rule interpretations once for market-wide use, firms can 'report once, trust always'. This approach improves data quality, reduces compliance costs, and transforms regulatory reporting into a source of strategic insight rather than a tactical burden."

"As the pace of industry adoption continues to pick up in 2026, we expect firms to require further extensions in DRR. The addition of SFTR for the securities finance markets, the implementation of MiFID III, which is due to start next year, and coverage for cross-jurisdiction reporting eligibility will be major areas of focus in 2026," said Labeis.

The remarks point to an industry agenda that spans further standardisation work, additional reporting scope and more cross-border consistency. Firms that operate across markets face ongoing decisions over operating models, data infrastructure and controls as rule changes continue and regulators seek more comparable information.

"As the pace of industry adoption continues to pick up in 2026, we expect firms to require further extensions in DRR. The addition of SFTR for the securities finance markets, the implementation of MiFID III, which is due to start next year, and coverage for cross-jurisdiction reporting eligibility will be major areas of focus in 2026," said Labeis.

REGnosys said 2026 would keep attention on Digital Regulatory Reporting extensions and on the handling of cross-jurisdiction reporting eligibility as firms respond to further updates from market regulators.