This chapter addresses the increasing focus on the need to understand the drivers of regulatory technology (RegTech) adoption and its impact on regulatory compliance processes in the financial ecosystem. This research adopts a qualitative research strategy using grounded theory methodology (GTM) to analyze global RegTech firms, developing a theoretical framework that explains the dynamics driving RegTech adoption. Research findings identify seven critical drivers of RegTech adoption: compliance automation, risk management, data management, and analytics, regulatory technology platforms, ESG compliance, regulatory reporting, and compliance monitoring. These drivers are critical to improving the efficiency, accuracy, and effectiveness of compliance management, revealing that the adoption of RegTech is not just a response to increasing regulatory demands in the financial industry but represents a strategic shift driven by technological innovation. These drivers are interconnected, each contributing to a more robust and efficient compliance framework that enables financial organizations to navigate the complexities of the regulatory landscape. The research then concludes by contributing to the academic field by providing a comprehensive understanding of the drivers of RegTech adoption across the multiple phases of compliance processes: regulation, monitoring, reporting, and supervision. Consequently, as regulatory requirements evolve, this chapter offers valuable insights for academics and practitioners as RegTech firms will perform an essential role in the financial ecosystem.