There was a focus on anti-money laundering in the industry during August, with accelerations in the use of AI for AML, as well as amendments made to regulations.
Here at Banking Circle, we also reached out to industry experts for their views on AML, artificial intelligence, and fighting financial crime amid the increasing speed of transactions, in our latest blog post.
Here are some other important stories from the industry you may have missed:
Investment in the FinTech industry hits new records
Nearly £18 billion in H1 2021 means a new record for Britain’s investment in the financial technology industry, and it puts the UK second in the world behind the US.
This is largely due to a tripling of India’s Foreign Direct Investment (FDI) output – over half of all Indian FDI goes to Britain, and India is Britain’s second largest source of investment, with this growing at pace. With both countries working towards a free trade agreement, the relationship looks set to become even more beneficial.
It isn’t just the UK having a strong year; globally, US$98 billion was spent on FinTech this year in just six months. This investment came from 2,456 deals, compared to last year’s annual total of $121.5 billion across 3,520 deals.
Over $51 billion was invested in FinTech in the Americas, from 1,188 deals, while the EMEA region saw $39.1 billion in FinTech investment.
In the Asia-Pacific region, $7.5 billion was invested across 467 deals.
Over a third of financial institutions accelerating their adoption of AI for AML
A survey of 850 ACAMS (Association of Certified Anti-Money Laundering Specialists) members worldwide, has revealed that 39% of financial institutions are accelerating their adoption of AI and machine learning (ML) for anti money laundering, in response to COVID-19.
The report, from SAS, KPMG and ACAMS, also shows that more than half (57%) of respondents have either already incorporated AI or ML into their AML compliance processes, or are planning to do so within the next 12 to 18 months. It’s a trend that’s consistent amongst both large and smaller financial institutions.
40% of those surveyed cited improving the quality of investigations and regulatory filings as the main driver behind this, while 38% claimed that reducing false positives and resulting operational costs were behind their adoption of AI and ML.
More on that here.
Consultations begin for amendments to Money Laundering Regulations 2017
The UK government has begun the consultation process for further amendments to the regulations, with changes up for discussion in areas most likely to affect those selling digital art, cryptoasset businesses, and trust and company service providers.
Consultation on the proposed areas of reform has already commenced and will remain open until 14 October 2021, with Amending Regulations proposed to be laid in Spring 2022.
Find out more about the changes.
Payment Standards Strategy Group publishes recommendations
Following UK Finance’s Future Ready Payments 2030 report earlier this year – which concluded that the payments industry should work to better understand how to use standards to deliver benefits to providers, financial institutions, businesses and consumers – UK Finance set up the Payment Standards Strategy Group (PSSG). This group was tasked with the specific intention of exploring whether the potential benefits of payment standards exist and, if so, defining a new approach to enable them to be realised.
The Payments Standards Strategy Group has now delivered a report of recommendations on how the industry can enable better coordination and collaboration between payment standard providers and their respective communities.
Download the report here.