Financial Crime World

Countering Financial Crime: A Guide for Payment Service Providers

Payment service providers (PSPs) play a crucial role in preventing financial crime. However, implementing effective control mechanisms requires a delicate balance between customer experience, cost, and responsiveness. In this article, we’ll explore the implications of control mechanisms for PSPs and provide actionable steps to help you stay ahead of financial crime.

The Importance of Control Mechanisms

PSPs must implement controls that prevent financial crime without compromising customer experience or increasing costs. Embedding controls within processes and decisions is crucial to ensure effective implementation. Here are some key takeaways:

Key Takeaways

  • PSPs must balance customer experience, cost, and responsiveness when implementing controls to prevent financial crime.
  • Embedding controls within processes and decisions is essential for effective control implementation.
  • Designing controls in proportion to the business model is critical for effective control implementation.
  • Focusing on data and building a business case for infrastructure investments can help PSPs make informed decisions about control implementation.
  • Planning for complexity and extracting better value from existing controls are also critical aspects of effective control implementation.

A Step-by-Step Guide to Implementing Controls

To effectively implement controls, follow this suggested plan of action:

Short-term (0-3 months)

  1. Conduct an internal review of current processes and procedures for preventing financial crime.
  2. Identify areas where controls are lacking or need improvement.
  3. Develop a business case for implementing new controls or enhancing existing ones.

Medium-term (3-6 months)

  1. Design and implement new controls that address identified weaknesses.
  2. Embed these controls within processes and decisions to ensure effective implementation.
  3. Establish a data-driven approach to monitoring and evaluating the effectiveness of controls.

Long-term (6-12 months)

  1. Continuously review and update control procedures to ensure they remain effective in preventing financial crime.
  2. Extract better value from existing controls by analyzing data and identifying areas for improvement.
  3. Plan for complexity and ensure dedicated experts are responsible for tracking and implementing changes.

By following this plan, PSPs can effectively implement controls to prevent financial crime and maintain a competitive advantage in the market.