As we come to the end of Q1, anti-money laundering measures have been a key focus in the industry.
Following the news from McKinsey that between $800 billion to $2 trillion is laundered annually via the global financial system, Banking Circle explored the ways criminals are using more sophisticated methods to launder funds, which was covered in this Crowdfund Insider article.
We also held a webinar with UK Finance on Driving better banking, joined by a panel of industry experts to discuss how partnerships are helping banks overcome innovation challenges and ways in which the landscape is likely to change over the coming year.
And finally, we’re proud to announce Banking Circle is now completely cloud-based, with all aspects of our infrastructure hosted within Microsoft Azure. The new cloud-first, cross border payments platform was built in-house and delivers greater speed, functionality, and a more intuitive user experience.
Here are some other important stories from the industry you may have missed this month:
The EBA publishes its final report containing revised AML and CTF risk factor guidelines
To recognise the emergence of new risks and changing EU legislative framework, the European Banking Authority (EBA) has released updated guidelines on customer due diligence, and the factors that credit and financial institutions should consider when assessing the money laundering and terrorist financing risks associated with individual business relationships and occasional transactions.
In supporting companies in their AML/CTF compliance efforts, revisions to the guidelines have been made in the following areas:
- Business-wide and individual ML/TF risk assessments
- Customer due diligence measures, including on the beneficial owner
- Terrorist financing risk factors
- Guidance on growing risks, including the use of innovative solutions for CDD purposes
Read the full report here.
The FATF and Egmont Group publish trade-based money laundering risk indicators
Staying with the money laundering theme, a new report from the Financial Action Task Force (FATF) and the Egmont Group, has been compiled to enhance the ability of both public and private entities to identify suspicious activity associated with trade-based money laundering.
The risk indicators are derived from a sampling of the data received during the Trade-Based Money Laundering (TBML) project and span four key areas:
- Structural risk indicators
- Trade activity risk indicators
- Trade document and commodity risk indicators
- Account and transaction activity risk indicators
EU countries support cross border instant payments plan
The EU Commission has announced that the EU Council of Ministers approved its fully integrated retail payment system strategy on 22 March 2021.
The strategy aims to permit payments within seconds for purchases made online and in stores around the EU, with countries fully endorsing this as a means to reduce their reliance on ‘large global players’ in the payment sector.
It was also revealed that the member states support the Commission’s announcement that it will be conducting a thorough analysis of the ongoing PSD2 implementation.
Read more on that here.
New study reveals bank boardrooms lack computer literacy
A report by Accenture analysing the career backgrounds of almost 2,000 directors at more than 100 of the world’s largest banks, found that only 10% of both CEOs and board directors have any professional technology experience.
The research also found that the number of banks with boards containing at least one member with professional technology experience has only increased by 10 percentage points in the last 5 years, from 57% to 67%. It’s a trend particularly prevalent in Brazil, China, Russia, Austria, and Italy.
This is at direct odds with how banks are accelerating their investment in technology to keep up with changing consumer demands and competition from challenger brands.
EU FinTechs form IBAN enforcement coalition
Leading FinTechs have launched an initiative to address IBAN discrimination in Europe. It’s been a growing problem for a while now, with companies across the EU reportedly refusing to accept payments from UK euro account holders because the IBAN contains the country code ‘GB’. Whilst the UK is no longer part of the European Union, it is still part of the Single Euro Payments Area (SEPA), and therefore this violates EU rules.
Several leading EU FinTechs have joined forces in an attempt to tackle IBAN discrimination that occurs when a bank or company does not accept a payment instruction outside the country where the bank or company is based. A new website has been launched, Accept my IBAN, where customers can file a complaint, which will be forwarded to the relevant authorities and the European Commission to relieve users of the inconvenience of dealing directly with disputed payments.
The EPA launches Payment Account Providers: 2021 edition
The Emerging Payments Association has published the second edition of its guidebook, ‘EPA’s Guide to Payment Account Providers: 2021 edition.’
Alongside the Association of Foreign Exchange and Payment Companies (AFEP), the EPA reached out to its members and over 20 providers to explain in their own words how to gain access to payment systems. This includes their eligibility criteria, risk appetite, product capabilities, and advice on how to select a suitable provider.
Through the report, the EPA and AFEP continue to champion increased open access to accounts and payments within the UK.