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Nordic Banks are transforming their AML transaction monitoring replacing rule-based monitoring with more advanced models.
- Nordic banks expect the number of TM-alerts to increase over the next two years. High false positive rates continue to pose a challenge.
- Infrastructure and software enhancements are expected to be key areas for increased spending.
- A majority of participating banks plan to invest in AI in the future to improve their TM.
AML transaction monitoring remains a crucial instrument for banks in the fight against financial crime. This survey indicates that high false positive rates continue to pose significant challenges for Nordic banks, which anticipate an increase in transaction monitoring alerts over the next two years.
Currently, most Nordic banks are engaged in or planning transformative initiatives for their AML systems, moving away from traditional rule-based monitoring towards more advanced models. This shift is driven by the substantial potential for enhanced detection and prevention of illicit activities, streamlined operations, improved customer journeys and satisfaction, and compliance with regulatory expectations.
To achieve these goals, Nordic banks are preparing to increase their spending, particularly in infrastructure and software enhancements, which are key areas for investment. These initiatives will not only address current challenges but also position banks for future success in combating financial crime.
Summary
The transition towards more advanced systems of detections is essential to enable enhanced financial crime prevention, optimizing operations and ensuring adherence to regulatory expectations. For more details – please read more in our report and reach out to us.