The Future of Transaction Monitoring: Better Ways to Detect and Disrupt Financial Crime

Abstract

The surveillance of client transactions by financial institutions, known as transaction monitoring has become a core Financial Crime Compliance (FCC) function. Market research suggests that transaction monitoring is one of the major growth areas in the global Regulatory Technology (RegTech) market, worth USD 2.2 billion in 2020.

This research paper analyses the failings of the current transaction-monitoring model given the scale of investment, the balance between cost and benefit along with the overall effectiveness of the suspicious transaction-reporting regime. it explores industry initiatives for innovation and reform and provides a set of recommendations to both address existing pain points and to provide potential alternatives and opportunities for the future towards the prospect of systemic monitoring.