Fintech industry ups anti-money laundering effort


The thriving domestic fintech industry is intensifying its efforts against financial crime, focusing on enhanced anti-money laundering and countering the financing of terrorism (AML/CFT) measures.

Kwaku Duah, Chief Executive Officer-Financial Intelligence Centre (FIC), disclosed significant initiatives are in the pipeline. He revealed that a new National Risk Assessment (NRA) is scheduled for 2024, followed by the country’s 3rd Round of AML/CFT Mutual Evaluation set to commence in the latter half of 2025. This is ahead of upcoming assessments in the realm of financial intelligence and compliance on anti-money laundering and countering the financing of terrorism.

At an inaugural FIC Fintech Workshop in Accra, Mr. Duah made a compelling call to action, emphasising the need for financial tech companies to prioritise compliance with anti-money laundering and counter-terrorism financing regulations.

He also highlighted the pivotal role of fintechs in promoting financial inclusion and digital innovation. “Fintech will be a significant area of focus during these assessments, underscoring the importance of complying with international and local AML/CFT regulations.”

The fintech sector’s rapid expansion in Ghana underscores the growing significance of this industry in reshaping the financial services landscape. Mobile money, commonly referred to as ‘MoMo’ has emerged as a powerful tool for advancing financial inclusion and digital transactions. The value of mobile money transactions soared from GH¢87.1billion in August 2022 to GH¢161.8billion in August 2023 – reflecting a nearly 100 percent increase over a two-year period.

The domestic fintech sector has witnessed tremendous growth, boasting over 46 licenced institutions spanning six primary categories under the Fintech and Innovation Office. These entities have harnessed the widespread mobile penetration to revolutionise financial services, making them more accessible and efficient.

However, this growth has also attracted the attention of criminals seeking to exploit these innovative platforms for financial crimes. The Bank of Ghana’s 2022 fraud report reveals that payment service providers (PSPs) experienced losses totalling GH¢27million due to fraud, emphasising the need for robust compliance monitoring solutions.

Strong anti-money laundering and counter-financing of terrorism (CFT) measures are imperative for fintech companies. Compliance with international regulations, such as the FATF Recommendations and the Anti-Money Laundering Act, is crucial to safeguard users and uphold the financial system’s integrity.

The financial cost of money laundering compliance across global financial institutions reached an unprecedented high of US$180.9billion in 2020. While the cost of compliance is substantial, the consequences of non-compliance – including sanctions, reputational damage and loss of investors – are far more expensive.

The event also shed light on the global nature of financial crime, with criminals continuously innovating to exploit fintech platforms for illegal activities. Attendees were presented with a case wherein an individual opened an online payment account and rapidly received millions of euros from questionable sources, underscoring the necessity of robust compliance and monitoring systems.

As the workshop concluded, Mr. Duah announced that Ghana is gearing up for a new National Risk Assessment (NRA) in 2024, followed by the country’s 3rd Round of AML/CFT Mutual Evaluation commencing in the latter half of 2025.

Fintech is set to be a significant focus during these assessments, underscoring the importance of adhering to international and local AML/CFT regulations.

The inaugural Financial Technology (fintech) Workshop was organised by the Financial Inclusion Committee in collaboration with the Bank of Ghana (BoG).

The event brought together key stakeholders from the fintech industry, regulatory bodies and the media to engage in comprehensive discussions about fintech’s pivotal role in the country’s evolving financial landscape.

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