The new APP scam protections & UK RegTechs bag 30% of top 10 Q3 deals

How will the new APP scam protections impact APP fraud?

A big challenge currently in the financial industry is the rise of authorised push payment fraud (APP). The Payment Systems Regulator (PSR) recently introduced new legislation on 7 October to combat this. How will this legislation impact fraud in authorised push payments?

Read the full story here.

Research highlight

UK leaps to secure 30% of the top 10 RegTech deals as funding halved in Q3 QoQ

Key Global RegTech investment stats in Q3 2024:

? Global RegTech funding halved in Q3 QoQ

? UK leaps to the top of the pack as it secured 30% of the top 10 deals for the quarter

? MirrorWeb, a leading UK provider of digital communications archiving and regulatory compliance software secured $63m in a funding round making it the biggest UK RegTech deal in Q3

In Q3 2024, the global RegTech sector recorded 71 transactions, marking a 37% reduction from the 112 deals completed in Q3 2023.

However, there was a moderate increase of 20% compared to the 59 deals in Q2 2024, suggesting some regained momentum within the quarter.

Despite the slight uptick in activity from Q2, total RegTech funding fell sharply, reaching just $854m in Q3 2024, a 58% drop from the $2.03bn raised in Q3 2023 and a 48% decline from the $1.65bn raised in Q2 2024.

This trend points to heightened caution within RegTech investing, as total funding continues to shrink while deal count sees only minor fluctuations, indicating an industry-wide shift toward smaller, possibly lower-risk investments.

The top 10 deals in Q3 2024 were dispersed across six countries, with the United States and the United Kingdom each securing three top deals.

This is a notable change from Q3 2023, where the US dominated the sector with seven of the top deals, and nations like Norway and Germany were more active players in high-value transactions.

In Q3 2024, the presence of new entrants like France and Denmark suggests a growing geographic diversity in major RegTech investments, potentially pointing to an expanding regulatory environment across Europe.

Israel and Germany maintained a consistent presence among top deals across both periods, while the U.K.’s rise from no top deals in Q3 2023 to three in Q3 2024 underscores an evolving leadership role in RegTech, likely driven by increasing regulatory demands in the financial and data privacy sectors.

MirrorWeb, a leading UK provider of digital communications archiving and regulatory compliance software, has secured $63m in growth equity funding from Mainsail Partners, marking the largest RegTech deal in the UK for the quarter.

Known for its innovative Insight platform, MirrorWeb supports financial institutions in meeting complex regulatory requirements by enabling comprehensive archiving across websites, mobile, email, instant messaging, and social media channels.

This latest investment will drive the company's product development and customer support capabilities, ensuring continued regulatory readiness for its clients.

With Mainsail’s support, MirrorWeb is positioned to enhance its value for financial services firms needing dependable, real-time compliance solutions, solidifying its impact on the RegTech sector in the UK.

RegTech news

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• How Siron One is driving RegTech innovation at IMTF - Founded in 1987, Switzerland-based IMTF develops RegTech solutions in the area of anti-financial crime, AML and CFT that help financial institutions stay compliant and digitalize their processes and operations. With nearly 40 years in the industry, what is next for IMTF? Read the full story here.
• How AI is shaping the future of financial crime prevention strategies - As artificial intelligence (AI) continues to advance, its role in financial crime prevention is growing, with organisations now considering AI as a foundational element in their risk management strategies. Read the full story here.

Regulation news

• JP Morgan pays $151m in sweeping SEC settlements over investor protection failures -The SEC, J.P. Morgan Securities LLC (JPMS) and J.P. Morgan Investment Management (JPMIM) have agreed to a substantial settlement following a series of violations. Read the full story here.
• CFTC warns against crypto scam tactics on messaging apps - The CFTC’s Office of Customer Education and Outreach has issued a stark warning about the increasing prevalence of crypto-related scams propagated through popular messaging apps like WhatsApp and Telegram. Read the full story here.
• Consumer advocates demand tougher oversight on Bank-FinTech partnerships - In a bid to protect consumers, the AFREF and the CFA have issued a call for stringent supervision over partnerships between banks and FinTech companies. Read the full story here.

RegTech Deal news

• MAP FinTech, Your Bourse link to offer brokers cutting-edge compliance and trading solutions - MAP FinTech?has joined forces with Your Bourse, a leader in trading infrastructure and liquidity management solutions. Read the full story here.
• GLEIF and Finbridge Global forge new path in FinTech identity verification - GLEIF and Finbridge Global are setting a new benchmark in identity verification within the FinTech sector. Read the full story here.
• Business Systems, Teneo.ai team to transform contact centres with Voice AI - Business Systems, a frontrunner in CX and contact centre solutions, alongside Teneo.ai, a leader in conversational AI orchestration, have declared a strategic alliance to revolutionise contact centres with Voice Automation and Gen AI technologies. Read the full story here.

CyberTech news

• Bugcrowd bags $50m from Silicon Valley Bank to amplify cybersecurity solutions - Bugcrowd, a pioneer in crowdsourced cybersecurity solutions, has secured a significant $50m growth capital facility from Silicon Valley Bank (SVB), a division of First Citizens Bank. Read the full story here.
• Manchester’s CloudGuard receives major funding boost for AI-driven cybersecurity growth - CloudGuard, a Manchester-based cybersecurity start-up, has announced a significant financial boost, raising funds from the Northern Powerhouse Investment Fund II (NPIF II). Read the full story here.
• AI-driven cybersecurity startup Corgea raises $2.6m in seed round - Corgea, a CyberTech specialising in AI-driven vulnerability detection and remediation, has closed a $2.6m seed funding round. Read the full story here.

Other RegTech news

• AI Federated Learning: Transforming the approach to combat financial crime - Less than 1% of actual illicit transactions are detected globally. This startling statistic exposes the vulnerabilities of financial firms to increasingly sophisticated criminal networks, despite heavy investment in anti-money laundering (AML) efforts. The question arises: are traditional methods and senior management approaches falling short? Read the full story here.
• Essential principles and advanced techniques in fraud risk management - Fraud risk management is critical in safeguarding an organization’s assets and reputation by identifying, assessing, and controlling fraud risks. Read the full story here.
• Mobile communication capture: exploring solutions in the BYOD era - In today’s digital landscape, the surge in mobile communication across business sectors has heightened the necessity for efficient mobile capture technologies. Read the full story here.