DIGITAL BANKING

However , the effectiveness of these measures remains a topic of debate . A 2021 report by Chainalysis revealed that despite increased regulation , cryptocurrency-based money laundering rose by 30 % in 2021 compared to 2020 .

This statistic underscores the ongoing cat-and-mouse game between regulators and bad actors , highlighting the need for continued innovation in regulatory technology ( RegTech ) solutions .

Ivo Gueorguiev highlights the fragmented nature of AML and KYC approaches across markets : “ Approaches in the AML and KYC space are extremely fragmented , creating inefficiencies across markets .

“ The infrastructure varies from country to country , and despite high costs , significant improvements to risk management are not happening .” Ivo emphasises the need for a more coordinated , Europe-wide effort , suggesting that “ centralised databases and standardised access to key data across all markets ” could streamline processes and significantly reduce AML risks .

Despite these challenges , positive trends are emerging in the space . Financial institutions are increasingly leveraging advanced technology and data analytics in their compliance programmes .

As Samar Pratt notes : “ Financial institutions are increasingly leveraging AI and ML to better detect suspicious patterns and transactions , allowing for more efficient identification of potential money laundering activities .”

This integration of technology , coupled with a shift towards perpetual KYC , represents a significant improvement in risk assessment and mitigation . fintechmagazine . com 107