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Remittance Services – Vital but Vulnerable

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Like the snow in our fitful northern winter, a flurry of recent articles highlights the rapid growth of the money remittance market. Remittance is the lifeblood of many communities, each with their own diaspora, and the sheer scale of this sector renders it vulnerable to abuse.

The Growing remittance Market

In recent years, this market has seen serious growth, especially as digital services have matured. Now individuals can send money across borders easily, usually without going to a specific store to do so. The size and value of the remittance market varies, depending on sources and methodology, but the globally it could have been worth USD 19.1 billion in 2022. It has an expected value of  nearly USD 78 billion by 2032. Of this market, the US share is about 30%. It’s big business.

The expansion of digital remittance services has inadvertently created new avenues for financial crimes such as money laundering and terrorism funding. Micro money laundering has emerged as a new challenge, where small amounts of money are laundered through multiple transactions to evade detection. These behaviors can be at such a scale and so well disguised that they are difficult for individual human observers to identify.

The Challenges of Compliance

All this means the responsibility on remittance services – and on their own banking service providers – is immense. They are tasked with facilitating seamless transactions and also with ensuring their platforms are not misused. This dual responsibility requires a robust compliance mechanism that is both effective and efficient. Effective in the sense that it leaves no gaps for criminal exploitation, and efficient so that it doesn’t become prohibitively expensive to manage

In this, thorough and effective transaction monitoring is essential. This involves scrutinizing transactions for any signs of suspicious activity, either as standalone events or as part of a larger pattern. The goal is to identify and stop any illegal use of remittance services, thereby protecting both the service provider and the end-users.

Compli: A Robust Solution for Compliance

In this regard, Compli, from Essiell Compli, stands out as an exemplary service. Compli offers a comprehensive suite of services that begin from the very start of Know Your Customer (KYC) procedures to – crucial in this context – routine transaction and behavior monitoring. Suspicious or anomalous activity is flagged for review and action at a speed and scale not practical for purely human teams. The power of Compli lies in its ability to integrate seamlessly with remittance services and the wider banking networks, providing a robust shield against financial crime while maintaining the efficiency of transactions.

In a world where remittance services are becoming increasingly vital yet vulnerable, the need for vigilant and comprehensive compliance is equally essential. Compli offers just that – a way for remittance services to stay ahead in a rapidly evolving market, ensuring safety, compliance, and peace of mind for themselves and their customers. In a world where everything seems possible, now is the time to make sure businesses remain safe, secure and compliant to meet those challenges.

By Declan Morton, staff writer at Essiell Ltd.

Sources – Digital Journal, January 3 & 5, 2024: Remittance Market Size, Share, Trend Top Key Players, Industry Share, Size, Trends and Forecast to 2032, Digital Money Transfer & Remittance Market Strategic Analysis to 2024-2031| Insights and Opportunities by 2031, Asia-Pacific Digital Remittance Market Size, Share, Value, and Competitive Landscape 2024 to 2032.  Precedence Research: Digital Remittance Market 2022-2032, and Modern Ghana, January 7, 2024: Micro Money Laundering: The New Kid on the Block. How prepared are we?

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