WHITE PAPERS

Since its inception in 2001, sanctions screening has been a complex and multifaceted challenge for financial institutions. Recent estimates reveal that the global financial community invests a staggering $30 billion annually to combat financial crime, with only a 1% success rate. Evidently, traditional approaches are falling short, and a fresh perspective is needed.

Neterium, in collaboration with its partner GSS, has released a White Paper, offering their collective #expertise on the subject of sanctions screening.

Titled "From utilities to industry-initiative: how a centralised service finally solved the financial community's sanctions screening problem" this paper promises to shed light on innovative solutions.

Through this collaborative effort, we aim at enhancing compliance and fostering a more secure and efficient financial ecosystem.

For further insights into GSS and Neterium, visit: https://www.neterium.io/insights/blog/gss-selected-neterium-as-its-exclusive-watchlist-screening-technology-partner/

The last few years have seen the emergence of a new payment instrument: instant payments. Instant payments allow people to transfer money from one account to another account at any time of any day within a few seconds.

While they do not offer yet the same ubiquity nor handle the same volumes as more traditional low-value ACH (Automated Clearing House) or correspondent banking payments, their take-up has been remarkable. At this stage, more than 60 markets already have live instant (or real-time) payments infrastructures whose take-up differs based on their maturity (e.g., UK Faster Payments was a precursor which went live in 2008 and processed more than 3 billion instant payments in 2021). While most of these systems focus on processing domestic payments, several initiatives are also on-going to open up these instant payments to process cross-border flows (e.g., RT-1 and TIPS are examples of pan-European instant payment systems).

While consumers and business will directly benefit from this new payment instrument, it also comes with significant challenges for financial crime compliance teams in terms of how to handle the related sanctions screening aspects. These include deciding which of these instant payments should be screened (based on each bank’s specific context, risk appetite and policies) and implementing the appropriate technology solution to efficiently process the expected large volumes within the very limited time allowed.

Banking-as-a-Service (BaaS) is on the rise. An increasing number of non-bank players (e.g., e-commerce platforms, retailers) are now embedding financial services such as payments, Buy Now Pay Later, wallets or lending in their offering to further improve their customer experience and maximise the value they can capture. And it does not stop there: some banks are also increasingly interested in using BaaS as they see an opportunity to focus on what they do best….

When speaking with analysts having to resolve sanction screening alerts, the first complaint you hear is usually about false positives: “There are too many alerts”, “The system always returns the same hits”, “we spend our time accepting hits we already accepted”, “why can’t the system just get smarter?”. To these analysts, we want to say: “We hear you”. And we might have good news for you. Let’s dive into a new approach that could really make alert handling better, safer and faster…

The payments landscape has dramatically evolved over the last couple of years. Hundreds of new fintechs – supported by billions in venture capital – have emerged with a mission to deliver a radically better customer experience for payments. Incumbents did not stand still: they reacted by modernizing their existing “rails” and embracing new payments methods or instruments…

In the past, to start a technology business such as a fintech, you had to build -at great cost- every single component that was required to deliver the service: user interface, back-office, operations… but also infrastructure, network or security. Today, all this changed radically, and fintech founders can rely on cloud services, open-source components and APIs to build their product.…

For many Fintechs, compliance with financial crime regulations is an iterative and painful discovery journey. While banks have been increasingly exposed to these regulations for over two decades, most Fintechs only got created over the last few years and their initial focus was – rightfully– on offering a distinctively better customer service and experience…

For many Fintechs, compliance with financial crime regulations is an iterative and painful discovery journey. While banks have been increasingly exposed to these regulations for over two decades, most Fintechs only got created over the last few years and their initial focus was – rightfully– on offering a distinctively better customer service and experience…

According to recent Celent estimates, the financial community spends around 30 billion USD every year at global level to fight financial crime. All players (financial institutions, fintechs and increasingly corporates as well) massively invest at individual level to comply with increasingly complex and far-reaching regulations, often with unintended negative side-effects in terms of end-customer experience and pace of innovation. And yet, the outcome is still really disappointing. It is estimated that only 1% of financial crime is actually prevented….

For many years, Transaction and Counterparty Screening has been a regulatory expectation in most countries as part of the broader Anti Money Laundering (AML) and Counter Terrorist Financing (CTF) regulations. It applies to all financial institutions but also increasingly to fintechs and corporates, which – beyond the compliance expected by their local authorities or their banking partners – also rightfully aim at making a positive ethical contribution to the whole community by helping fight financial crime…