For much of the past decade, the AML technology stack has acted as a safety blanket for financial institutions. As the RegTech market expanded rapidly, compliance leaders accumulated single-purpose tools to keep pace with regulatory change. What once felt progressive has since become a burden.
According to RelyComply, fragmented platforms, siloed data and disconnected workflows are now undermining oversight and, in some cases, creating new compliance risks rather than reducing them.
Looking ahead to 2026, the industry is approaching a genuine turning point. Instead of adding yet another solution, many firms are being forced to reassess what they already have. A ‘less is more’ philosophy is beginning to take hold, centred on consolidating critical capabilities, standardising regulatory processes and rebuilding the sense of control that RegTech originally promised. The goal is not replacement, but reintegration.
Regulation continues to exert enormous pressure on business operations, influencing everything from data governance and cyber resilience to ethics and sustainability. New rules frequently expose the limitations of existing onboarding, screening or risk-scoring systems, leaving institutions scrambling to adapt. Over time, this has encouraged a patchwork approach to AML technology, with quick fixes layered on top of one another to address immediate pain points.
However, these digital sticking plasters rarely connect in a meaningful way. Data remains fragmented, processes duplicated and insights difficult to surface. Despite years of investment, many firms still report that constant regulatory change makes it harder to maintain stable IT environments. This creates a costly cycle in which more tools are purchased to manage growing data volumes, yet little progress is made towards a cohesive AML framework.
The result is what many now describe as ‘RegTech bloat’. Compliance teams are left manually reconciling information across systems, draining time and morale. Executives question why costs continue to rise despite automation initiatives, while CFOs seek clearer evidence of return on investment. At the same time, supervisors expect full auditability across AML processes, something that is almost impossible when data quality is inconsistent and systems remain disconnected.
In an environment of tighter budgets, simply acquiring more technology is no longer viable. Instead, attention is shifting towards optimisation. The first step is technical consolidation. By reducing vendor sprawl and integrating existing data pipelines, institutions can merge overlapping workflows into modular platforms that adapt as regulations evolve. A unified architecture creates a single source of truth, removing duplication, reducing false positives and improving audit readiness. Crucially, each retained tool must demonstrate measurable value, from faster onboarding to shorter investigation cycles.
Technology alone, however, is not enough. Leadership plays a decisive role in determining whether reintegration succeeds. AML platforms and people must work in tandem, supported by a strong compliance culture and clear strategic direction. In 2026, effective leaders are expected to rigorously assess which capabilities genuinely support regulatory outcomes, align stakeholders around shared objectives and remove legacy partnerships that no longer deliver value.
This disciplined approach is already influencing how firms procure RegTech. Many are moving towards partnership-based models, where vendors collaborate within a shared ecosystem rather than competing in isolation. According to PwC’s Global Compliance Study, 59% of compliance officers now feel they hold significant influence over business strategy, signalling a shift towards more integrated decision-making. By strengthening interoperability and long-term collaboration, institutions can finally extract value from existing investments and build AML systems designed to scale.
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