How is AI being leveraged for compliance in financial services?

Top Story of the Week

How is financial services leveraging AI for compliance purposes??– In a time where AI is revolutionising industry after industry, the increasing need and desire to automate compliance is becoming ever more sought after.

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Research highlight

UK InsurTech companies raise a combined $234m in 2022, down 71% from 2021 levels

Key UK InsurTech investment stats in 2022:

• UK InsurTech investment reduced greatly in 2022 reaching $234m, a 71% drop from 2021
• UK InsurTech deal activity in 2022 grew by one deal reaching 43 deals in total.
• London was home to 74% of UK InsurTech deals during 2022

UK InsurTech has remained resilient in 2022, growing by one deal to reach 43 deals in total during the year. UK deal activity across all FinTech sectors saw a 24% drop in 2022 signalling that VCs have strong faith in the UK’s insurance market’s innovation going forward. Investment in the UK InsurTech sector during 2022 saw a dramatic 71% drop from the previous year. The largest deal in 2021 was $350m (ManyPets) compared to $45m (Instanda) in 2022, an 87% drop.

Instanda, a platform for integrated insurance products, was the largest InsurTech deal in 2022, raising $45m in their latest Series B funding round, led by Toscafund Asset Management. The allocated funds will be utilized to boost the platform's functionalities, particularly in the areas of billing, claims, and product accelerators, with a specific emphasis on the US and Canadian markets. Through these efforts, the platform will have the ability to cater to a more extensive array of insurers, revolutionizing the customer experience by significantly minimizing claims processing expenses, digitizing all aspects of the insurance value chain, and constructing complete product aggregation capabilities.

London continues to be the InsurTech hub of the UK with a 74% share of InsurTech deals raised. The UK was the most active InsurTech country in Europe during 2022 with a 32.8% share of total deals.

UK Insurance regulation will be directly impacted by the UK’s Treasury in 2023 which is taking forward plans to change the UK’s Solvency II regime. Its announcement coincided with the Autumn 2022 statement, signifying the importance attributed to Solvency II reforms within the Government’s wider post-Brexit plans for the economy. Solvency II reforms are just one of a series of regulatory changes proposed by the Government in its flagship Financial Services and Markets Bill (FSM Bill). In tandem with the FSM Bill, the Treasury has announced a series of reforms, known as the Edinburgh Reforms, which are similarly aimed at driving growth and competitiveness in the financial services sector post-Brexit.

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Weekly FinTech deal roundup

FinTech funding takes dip after 2 week high - There were 30 FinTech deals completed this week, with a total of $479.4m raised in total. This is a significant drop from last week’s deals where $1.1bn was raised collectively across 25 deals. It is an even bigger dip from two weeks ago when a total of $7.2bn.

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RegTech news

• World Trade Board opens talks on how to help MSMEs?- The World Trade Board has launched a consultation around a new framework that would increase access to trade for micro, small and medium-sized businesses (MSMEs). Read the full story?here.
• Communication compliance startup LeapXpert raises $22m?- LeapXpert, which stylises itself as the responsible business communication pioneer, has netted $22m for its Series A+ funding round. Read the full story?here.
• Fraud and bot management platform DataDome collects $42m?-?DataDome, which has built an AI-powered online fraud and bot management platform, has closed its Series C funding round on $42m. Read the full story?here.

InsurTech news

• Lemonade Crypto Climate Coalition protects over 7,000 Kenyan farmers?- The Lemonade Crypto Climate Coalition, a blockchain based parametric crop protection for subsistence farmers, has completed its initial launch. Read the full story?here.
• Thai InsurTech startup Roojai closes Series B?- Thailand-based B2C InsurTech startup Roojai has closed its Series B funding round on $42m. Read the full story?here.
• Catastrophe-exposed property insurance provider SageSure secures $50m?- SageSure, a provider of catastrophe-exposed property insurance, has raised $50m to fuel its growth. Read the full story?here.

Don't Miss Out - Global InsurTech Summit will be hosted on 18th April 2023!

The 5th Annual Global InsurTech Summit will host hundreds of vetted senior decision-makers alongside the most disruptive InsurTech founders and tech innovators in Europe. Find out more?here.

WealthTech news

• Is the UK open banking sector at a crossroads??- Recent research conducted by the Coalition for a Digital Economy (Coadec) has cautioned that the open banking industry is at a ‘vital crossroads’. Read the full story?here.
• Raisin nets €60m in Goldman Sachs-backed Series E?- Raisin, a global savings and investment specialist, has raised €60m in a Series E funding round backed by Goldman Sachs. Read the full story?here.
• Personal finance app Playbook snares $7m in Series A?– Playbook, a California-based personal finance app focused on Gen Z and Millennials, has secured $7m in a Series A funding haul. Read the full story?here.

CyberTech news

• Cloud identity security platform Britive lands $20.5m Series B?- Britive, a cloud identity security platform, has secured $20.5m in a Series B funding round headed by Pelion Venture Partners. Read the full story?here.
• Identity security firm Spera nets $10m seed funding?- Spera, an Israel-based cybersecurity startup offering protection from identity-driven threats, has scored $10m in seed funding. Read the full story?here.
• Zero-trust content security startup Votiro bags Series A?- Votiro, a zero-trust content security company, has collected $11.5m in its Series A funding round, which was led by Harvest Lane Asset Management.mRead the full story?here.

ESG FinTech news

• FCA delays sustainability disclosure requirements introduction?- The Financial Conduct Authority (FCA) has revealed it will push back the introduction of its sustainability disclosure requirements for asset managers. Read the full story?here.
• Cogo, Eliq partner to help banking customers with climate change?- Carbon footprint management company Cogo has partnered with Eliq to help banks and their customers navigate the challenges faced by climate change and the cost of living and energy crises. Read the full story?here.
• Impact-as-a-service startup Spiral closes Series A?- Spiral, which claims to be a pioneer of ‘impact-as-a-service’, has secured $28m for its Series A round, as it looks to expand across the US. Read the full story?here.

Other FinTech news

• Web3 protocol Polytrade secures seed funding?- Polytrade, a global trade focused Web3 protocol, has secured $3.8m in its seed funding round. Read the full story?here.
• Consumers want better security and frictionless payments online?- Consumers are seeking greater security and frictionless payment experiences when buying products online, according to a survey from BR-DGE. Read the full story?here.
• Zenus Bank acquires Financial Urban Exchange to support LatAm and Caribbean?- Zenus Bank, a digital bank that allows people to open US bank accounts around the world, has acquired real-time payments company Financial Urban Exchange. Read the full story?here.