loader image

Money Transfer Services – Why Small Details Matter

Share this post:

As in any other business, in the UK’s remittance sector getting the details right is fundamentally important. It’s a growing market, possibly booming. Operators who pay consistent attention to detail should succeed. Those who take shortcuts make themselves especially vulnerable.

With an estimated worth of approximately £9.12 billion in 2024, projected to rise to £10.02 billion by 2028, the opportunities for Money Transfer Businesses (MTBs) are considerable. The number of migrant workers continues to grow, and an established population of UK nationals and long term residents regularly send money overseas.

Digital technology makes entry to market simpler than ever – but there’s more to consider

As the market expands, so too does the number of players. Digital technology has lowered the barriers to entry, so that there are now over 600 MTBs operating in the UK. The mix includes not only  a micro businesses and SMEs, but also large banks. They’re all drawn by the lucrative potential of the sector. However, in such a crowded and competitive environment, success hinges on more than having a sought-after service; it requires delivering that service efficiently and at a competitive price.

Many MTBs, particularly those not operating as banks, leverage established banking infrastructures for fund transfers, benefiting from economies of scale and robust financial frameworks. Superficially, this might seem to alleviate some regulatory burdens, but the reality is quite different. MTBs are subject to the same stringent regulations as banks, particularly regarding knowledge of their customers and checks aimed at preventing financial crime, especially money laundering.

A growing market bound by regulation is no place for amateurs

Recent coverage in the Droitwich Standard has underscored the importance of maintaining rigorous financial regulatory compliance across the banking and financial services sectors. This message is especially pertinent for Money Transfer Services, given their vulnerability to exploitation by money launderers. Effective protection against sophisticated financial crime is non-negotiable, and the complexity and volume of customer checks required mean automation is the only feasible solution.

Thus, the choice of third-party provider for compliance services is critical. The ideal partner offers comprehensive customer screening for anti-money laundering, counter-terrorism funding. It will cover checks for sanctioned and politically exposed persons and companies. Additionally, real-time address and ID verification are essential. And they’ll need to dovetail that with an Identifier Service that highlights stolen and resold information.

After onboarding, surveillance of customer activities against a range of behavioural patterns, including expected and historic actions, is needed to  flag unusual or suspicious activities. Detailed person profiles, built from multiple databases, provide the level of detail necessary for confidence in the data. Infinite scalability ensures that the service can adapt to changing market demands.

The right choice of compliance partner is crucial

While many providers promise comprehensive protection, few deliver on all these fronts. Compli, from Essiell Compli, is different. It stands as a proven name in the world of financial services regulatory compliance. It meets all these requirements and more, offering a robust solution that ensures MTBs can focus on their core business while staying compliant and secure.

As the UK remittance market grows, competitive advantages will be gained through efficient and effective compliance. That will come via solutions that can handle huge volumes of detailed information quickly and reliably.  For MTBs, choosing the right compliance partner, like Compli, is a strategic decision of make or break significance.

By Declan Morton, staff writer at Essiell Compli


For reference: United Kingdom International Remittance Business Report 2024: Total Inbound and Outbound Remittance to Reach $17.93 Billion in 2028 – Startups are Entering the Market to Serve the African Diaspora, Yahoo! Finance, 10th April 2024;  AML (Anti-Money Laundering) in 2024: A Guide for Banks and Fintechs, Droitwich Standard, 3rd May 2024.

Share this post:

Our latest posts