Adapting compliance in a fragmented regulatory world

Rasha Abdel Jalil, Director of Financial Crime & Compliance at Eastnets, discusses the operational and strategic shifts needed to stay ahead of regulatory compliance in 2025 and beyond.

As we move through 2025, financial institutions face an unprecedented wave of regulatory change. From the EU’s Digital Operational Resilience Act (DORA) to the UK’s Basel 3.1 rollout and upcoming PSD3, the volume and velocity of new requirements are constantly reshaping how banks operate.

But it’s not just the sheer number of regulations that’s creating pressure. It’s the fragmentation and unpredictability. Jurisdictions are moving at different speeds, with overlapping deadlines and shifting expectations. Regulators are tightening controls, accelerating timelines and increasing penalties for non-compliance. And for financial compliance teams, it means navigating a landscape where the goalposts are constantly shifting.

Financial institutions must now strike a delicate balance: staying agile enough to respond to rapid regulatory shifts, while making sure their compliance frameworks are robust, scalable and future-ready.

The new regulatory compliance reality

By October of this year, financial institutions will have to navigate a dense cluster of regulatory compliance deadlines, each with its own scope, jurisdictional nuance and operational impact. From updated Common Reporting Standard (CRS) obligations, which applies to over 100 countries around the world, to Australia’s new Prudential Standard (CPS) 230 on operational risk, the scope of change is both global and granular.

Layered on top are sweeping EU regulations like the AI Act and the Instant Payments Regulation, the latter coming into force in October. These frameworks introduce new rules and redefine how institutions must manage data, risk and operational resilience, forcing financial compliance teams to juggle multiple reporting and governance requirements. A notable development is Verification of Payee (VOP), which adds a crucial layer of fraud protection for instant payments. This directly aligns with the regulator’s focus on instant payment security and compliance.

The result is a compliance environment that’s increasingly fragmented and unforgiving. In fact, 75% of compliance decision makers in Europe’s financial services sector agree that regulatory demands on their compliance teams have significantly increased over the past year. To put it simply, many are struggling to keep pace with regulatory change.

But why is it so difficult for teams to adapt?

The answer lies in a perfect storm of structural and operational challenges. In many organisations, compliance data is trapped in silos spread across departments, jurisdictions and legacy platforms. Traditional approaches – built around periodic reviews, static controls and manual processes – are no longer fit for purpose. Yet despite mounting pressure, many teams face internal resistance to changing established ways of working, which further slows progress and reinforces outdated models. Meanwhile, the pace of regulatory change continues to accelerate, customer expectations are rising and geopolitical uncertainty adds further complexity.

At the same time, institutions are facing a growing compliance talent gap. As regulatory expectations become more complex, the skills required to manage them are evolving. Yet many firms are struggling to find and retain professionals with the right mix of legal, technical and operational expertise. Experienced professionals are retiring en-masse, while nearly half of the new entrants lack the right experience needed to step into these roles effectively. And as AI tools become more central to investigative and decision-making processes, the need for technical fluency within compliance teams is growing faster than organisations can upskill. This shortage is leaving compliance teams overstretched, under-resourced and increasingly reliant on outdated tools and processes.

Therefore, in this changing environment, the question suddenly becomes how can institutions adapt?

Staying compliant in a shifting landscape

The pressure to adapt is real, but so is the opportunity. Institutions that reframe compliance as a proactive, technology-driven capability can build a more resilient and responsive foundation that’s now essential to staying ahead of regulatory change.

This begins with real-time visibility. As regulatory timelines change and expectations rise, institutions need systems that can surface compliance risks as they emerge, not weeks or months later. This means adopting tools that provide continuous monitoring, automated alerts and dynamic reporting.

But visibility alone isn’t enough. To act on insights effectively, institutions also need interoperability – the ability to unify data from across departments, jurisdictions and platforms. A modern compliance architecture must consolidate inputs from siloed systems into a unified case manager to support cross-regulatory reporting and governance. This not only improves accuracy and efficiency but also allows for faster, more coordinated responses to regulatory change.

To manage growing complexity at scale, many institutions are now turning to AI-powered compliance tools. Traditional rules-based systems often struggle to distinguish between suspicious and benign activity, leading to high false positive rates and operational inefficiencies. AI, by contrast, can learn from historical data to detect subtle anomalies, adapt to evolving fraud tactics and prioritise high-risk alerts with greater precision.

When layered with alert triage capabilities, AI can intelligently suppress low-value alerts and false positives, freeing up human investigators to focus on genuinely suspicious activity. At the more advanced stages, deep learning models can detect behavioural changes and suspicious network clusters, providing a multi-dimensional view of risk that static systems simply can’t match.

Of course, transparency and explainability in AI models are crucial. With regulations like the EU AI Act mandating interpretability in AI-driven decisions, institutions must make sure that every alert or action taken by an AI system is auditable and understandable. This includes clear justifications, visual tools such as link analysis, and detailed logs that support human oversight.

Alongside AI, automation continues to play a key role in modern compliance strategies. Automated sanction screening tools and watchlist screening, for example, help institutions maintain consistency and accuracy across jurisdictions, especially as global lists evolve in response to geopolitical events.

Similarly, customisable regulatory reporting tools, powered by automation, allow compliance teams to adapt to shifting requirements under various frameworks. One example is the upcoming enforcement of ISO 20022, which introduces a global standard for payment messaging. Its structured data format demands upgraded systems and more precise compliance screening, making automation and data interoperability more critical than ever.

This is particularly important in light of the ongoing talent shortages across the sector. With newer entrants still building the necessary expertise, automation and AI can help bridge the gap and allow teams to focus on complex tasks instead.

The future of compliance

As the regulatory compliance landscape becomes more fragmented, compliance can no longer be treated as a tick-box exercise. It must evolve into a dynamic, intelligence-led capability, one that allows institutions to respond to change, manage risk proactively and operate with confidence across jurisdictions.

To achieve this, institutions must rethink how compliance is structured, resourced and embedded into the fabric of financial operations. Those that do, and use the right tools in the process, will be better positioned to meet the demands of regulators today and in the future.