By Abhishek Chatterjee
Following the exciting news that Thunes has taken a majority stake in Tookitaki, I’d like to share briefly how the alliance will strengthen both companies.
Demand for Anti-Money Laundering (AML) solutions is unprecedented. The volume of digital banking and ecommerce transactions is rising exponentially, with global cashless payment volumes expected to increase by more than 80% from 2020 to 2025 and total cross-border payments already reaching over $156 trillion. Unfortunately, this vast flow of money crisscrossing the globe provides cover for money laundering. Criminals have been quick to use advanced technology to exploit loopholes and vulnerabilities in the system, while governments worldwide have raced to bring in new regulations to counter fraudulent activities.
AML is a top priority for all financial institutions (FIs), including Thunes’ partners across the world's largest cross-border payment network. Designed on three C-principles - comprehensive, convenient and compliant - Tookitaki’s AML platform can empower FIs to strengthen their risk coverage and mitigate risks seamlessly in the ever-evolving world of regulatory compliance.
Boosting Compliance, Cutting Costs
The United Nations Office on Drugs and Crime (UNODC) estimates that between 2-5% of global GDP, or US$800 billion - US$2 trillion, is laundered each year. Given the scale of criminal activity, regulatory authorities have become increasingly active in investigating suspected non-compliance with AML regulations and sanctions requirements. According to Kroll’s annual Global Enforcement Review 2022, the value of fines issued by regulators reached US$2.25 billion in 2021, with almost 20 per cent more fines levied than the previous year.
Reputational damage is also a risk of non-compliance. Data might be the new oil thanks to this century’s skyrocketing digital economy, but another precious commodity comes close: trust. Without it, the entire digital payments ecosystem starts to fall apart. Trust in the resilience of a financial institution, trust in their security arrangements, and trust in the standards for the way they do business are all essential to customers.
However, ensuring compliance while keeping up with frequently changing regulations in different markets comes at a price. One report suggests that the cost of financial crime compliance climbed over 18% from 2020 to 2021 to reach $213.9 billion. Therefore, lowering these operating costs and cutting fees for non-compliance brings significant benefits.
Tookitaki’s Next-Gen Compliance Solution
Older AML tech used by financial institutions proved ineffective as it was too slow to adapt to advanced money laundering methods used by criminals. The traditional rule-based system creates alerts about suspicious transactions based on minimal parameters. This tends to produce many false positives and requires significant bank resources to analyse financial trails which are predominantly legitimate. A more agile and dynamic risk-assessment model is needed.
Tookitaki’s Anti-Money Laundering Suite (AMLS) is an end-to-end AML detection and prevention application. A paradigm shift from the traditional rules system, it learns from a decentralised typology repository, where experts from the ecosystem contribute money laundering patterns in a privacy-preserved manner. Financial institutions can ingest and test the patterns based on the relevance of their customer groups and the product lines they cater to. The mechanism provides them with comprehensive risk coverage and helps them adapt seamlessly to changing customer behaviour and regulatory needs. The innovation won Tookitaki a place in the World Economic Forum’s Technology Pioneer Cohort of 2019.
Over the years, AMLS has been tested and deployed across banks and fintechs globally, which have benefitted from high-quality alerts, with a 40 per cent reduction in false positives. AMLS, therefore, offers effectiveness and efficiency in today’s AML programmes. The trust is further enhanced through our patent-published Explainable AI (XAI) framework, which provides fairness and transparency to our AI-driven techniques. AMLS can be deployed independently or can complement any legacy system, providing ultimate flexibility to FIs.
Learn More: Compliance Challenges for Payment Companies
Building a Powerful Global Alliance
For now, Tookitaki and Thunes will continue operating separately while accelerating our growth plans. As a matter of this alliance, Tookitaki will change its logo to ‘Tookitaki, a Thunes company’ to address the close connection between the two companies. We've also identified many ways to engage our existing customers and empower them to fight financial crime and create safe, secure and sustainable societies.
All Thunes’ customers will get access to high-tech compliance systems and, as such, will reduce the cost of transferring money across borders.
We will offer them our award-winning solutions:
- Tookitaki Anti-Money Laundering Suite (AMLS): Our end-to-end AI-powered AML / CFT software application
At the same time, all Tookitaki customers will automatically get access to the Thunes far-reaching network and profit from the global scale.
We’re looking forward to creating the world’s most effective AI-enabled AML platform, powered by our combined capabilities, expertise and tech resources.
Schedule a call with us to learn more about our solutions.
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