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RegTech is composed of the words “regulatory” and “technology”. It is a collective term for the application of modern technologies, to get the increasing regulation in the banking- and financial sector under control both from an IT and a legal standpoint.
Introduction
Attitude of the country towards RegTech-services
The utilization of RegTech services is in Bulgaria is mostly concentrated in providing AML services, identification services and are mostly aimed to assure fraud prevention. Apart from certain automation and integrational tools, fragmentally used by supervised financial entities, downright RegTech services are not yet developed in Bulgaria. However, with the growing regulatory requirements, such services could be in high demand.
Legal affairs
Obligations and requirements to provide RegTech-services
The general provision of RegTech services is not regulated in Bulgaria and there is no obligation for the entities to use such services.
Additional comments regarding the legal situation for RegTech-services or what RegTech’s must be aware of in this business area
Some RegTech services might be regulated but only if they consist of provision of outsourced critical functions of financial entities according to DORA Regulation 2022/2554.
Economic conditions
Market size for RegTech-services and biggest companies in this business area
Bulgarian RegTech market is growing in recent years, mostly in AML, fraud prevention and identification services with around 5 to 10 big companies providing reliable and high-quality services.
Additional comments regarding the economic situation for RegTech-services or what RegTech’s must be aware of in this business area
The growing regulatory landscape will naturally increase demand for more complex RegTech services since the need for digitalization and optimization of processes is well recognized.