The Bank for International Settlements published a working paper on the institutional drivers of supervisory technology (suptech) adoption by financial authorities, finding that the strongest progress from proof of concept to full deployment is associated with combining institution-wide strategies for digital transformation, data governance and suptech and backing them with dedicated organisational capacity. Using 2024 survey data from 112 financial authorities across 97 countries, the paper applies a two-stage hurdle model to separate the decision to start suptech projects from the scale of adoption. Authorities with all three strategies in place are estimated to deploy substantially more tools, including an increase of about 24 deployed applications in the paper’s interaction results, and to report fewer design and implementation challenges. The presence of a dedicated suptech unit is identified as the most critical organisational factor for increasing the number of deployed applications, while authority size and having supervision as a primary mandate are linked to initiating more advanced projects; deployment is reported to lag in emerging supervisory areas such as climate and environmental risks, cyber risk and digital assets. The paper also reports that public cloud adoption is associated with a higher probability of implementing AI tools, while reliance on in-house development is more closely associated with early-stage AI experimentation and external-only sourcing correlates with lower AI adoption.

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