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An AML Risk Assessment for the Payments Sector

Payment service providers (PSPs) play a critical role in financial markets by bridging the gap between traditional banks and businesses.

This allows them to be less dependent on financial institutions and flexibly manage transactions on product offerings, including credit cards, debit cards, e-wallets, cash cards, bank transfers, and more.

According to Boston Consulting Group, the global payment processing market is expected to almost double to $2.9 trillion by 2030. However, as the volume, speed, and sophistication of digital payments grow, so will PSPs' financial crime vulnerabilities.

Sanctions evasion, terrorist financing, fraud, and money laundering can be facilitated through PSPs in different forms, depending on the type of product and channel used. Typical approaches involve blending funds, smurfing (breaking down funds into smaller amounts), fraud, and using offshore accounts or complex ownership structures that hide beneficial owners applied to PSPs.

This guide, produced by experts at ComplyAdvantage based on their extensive work with global payments companies, is a practical guide to the key financial crime risks firms in this sector face. It is designed to help payments companies understand and prioritize the risks they face so they can mitigate them more effectively.

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Disclaimer: This is for general information only. The information presented does not constitute legal advice. ComplyAdvantage accepts no responsibility for any information contained herein and disclaims and excludes any liability in respect of the contents or for action taken based on this information.