The latest survey report by Finextra, which included responses from 200 financial services professionals across the US, highlights both optimism and uncertainty surrounding the sector’s regulatory readiness. Conducted between January 16–29, 2025, the survey captured insights from C-level executives to senior managers working in banks, credit unions, payment service providers, technology providers, and fintech firms with revenues ranging from under $10 billion to over $250 billion. These findings come at a pivotal time following the election of Donald Trump and the delay in new regulatory rulemaking, creating a climate of heightened uncertainty for the US financial sector.
Regulatory confidence amidst a pause
96% of respondents said they were either ‘very confident’ or ‘quite confident’ expressed in their ability to meet compliance deadlines in 2025. Despite this optimism, the survey reveals a complex regulatory environment. Data security regulations, particularly in light of concerns over cybersecurity, have the highest impact on financial decision-making across regions. Notably, 26% of banks cited the Bank Data Security Act as the most influential regulation for 2025, underscoring the critical nature of protecting financial data in an era of increasing cyber threats.
Technology adoption: A double-edged sword
Technology’s role in ensuring compliance is paramount, with 72% of respondents leveraging data analytics and 66% utilising AI to help meet regulatory requirements. This shift to data-driven decision-making is seen as a positive step forward for the industry, particularly as financial institutions work to streamline compliance efforts.
However, the survey uncovered significant gaps in the industry’s technological capabilities. A mere 3% of respondents indicated that their current technology stack fully meets compliance needs. This highlights a critical challenge for financial institutions looking to remain competitive and compliant in a rapidly evolving regulatory landscape. Despite the adoption of advanced technologies, the data suggests that financial institutions are still struggling to integrate and leverage their technology effectively to manage compliance risks.
Barriers to compliance: Cost, complexity, and talent shortages
The survey also reveals that financial services firms face several barriers to achieving compliance. For instance, 36% of participants highlighted the high costs associated with compliance as their primary concern. Nearly half (46%) of respondents expect to spend between 8-10% of their EBITDA on compliance efforts in 2025, signalling that regulatory costs are becoming a significant financial burden for many organisations.
In addition to this, 25% of respondents identified differentiated compliance requirements as a major challenge, highlighting the complexity of the regulatory environment. With regulatory frameworks in limbo, businesses are grappling with how best to align their operations with evolving standards.
Compounding these challenges is a persistent talent shortage. The survey found that 50% of organisations struggle to find the right knowledge, both in terms of specific expertise and to address the fluidity of the regulatory landscape.
Collaboration and third-party partnerships on the rise
A notable 73% of organisations reported working with third-party vendors or consultants to navigate regulatory changes more effectively. This trend reflects a broader industry shift toward collaboration, as financial services firms recognise the need for expert guidance and additional resources to stay compliant.
With only 6% of organisations not considering third-party partnerships, the data suggests that many institutions are leveraging external expertise to mitigate compliance challenges and enhance their risk management frameworks.
A focus on credit unions and community banks
One standout feature of the survey is its focus on credit unions, which often remain underrepresented in financial services research. The survey’s inclusion of a wide range of credit union responses highlights their essential role in financial inclusion and their contributions to consumer and small businesses. For fintechs and traditional financial institutions both, the data provides valuable insights into how credit unions are shaping the regulatory landscape, especially as they maintain strong ties to Community Development Financial Institutions (CDFIs).
Looking ahead: A changing landscape
With regulatory changes on the horizon and ongoing uncertainty surrounding the Trump Administration’s approach to de-regulation, the financial services sector finds itself at a crossroads. While the industry remains confident about its ability to meet compliance deadlines in 2025, the data suggests that organisations must work to overcome significant barriers in cost, technology adoption, and talent acquisition.
As financial institutions continue to adapt to the evolving regulatory landscape, their strategies must incorporate technology, third-party partnerships, and a deeper understanding of the unique role that credit unions play in the financial ecosystem. For many, this will mean reassessing risk management frameworks and investing in new technologies to better meet the demands of an increasingly complex regulatory environment.
The insights from Finextra’s survey offer a timely roadmap for financial institutions to refine their compliance strategies and better position themselves for the challenges ahead in 2025.
Curious for more insights? Download the full report here.