Transaction Monitoring

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Did you know? In 2023, 78% of financial institutions had implemented real-time transaction monitoring systems.

1. What is Transaction Monitoring?

Transaction monitoring is the process of analyzing customer transactions in real time or retrospectively to detect suspicious activity. It helps financial institutions identify fraud, money laundering, and compliance risks by tracking behavior patterns and flagging anomalies.

2. What is KYC transaction monitoring?

KYC transaction monitoring combines Know Your Customer (KYC) data with ongoing transaction analysis. It ensures that a customer’s financial behavior aligns with their risk profile, allowing institutions to detect unusual activity early and comply with AML (Anti-Money Laundering) regulations.

3. What is an example of a transaction monitoring scenario?

An example of a transaction monitoring scenario is when a customer suddenly makes multiple high-value international transfers inconsistent with their usual behavior. The system flags these transactions for review to prevent potential money laundering or fraud.

4. Who is responsible for transaction monitoring?

The compliance and risk management teams are primarily responsible for transaction monitoring. They oversee automated monitoring systems, investigate alerts, and report suspicious activities to regulatory authorities in compliance with AML and KYC guidelines.

See how AI voicebots transform transaction monitoring in banking.