As fintechs reshape banking in Australia, AML compliance has become a critical factor in building trust and meeting AUSTRAC’s expectations.

Introduction

Australia’s fintech industry has grown rapidly over the last decade, transforming how people save, invest, borrow, and send money. With innovations in digital wallets, buy now pay later (BNPL), peer-to-peer lending, and cross-border payments, fintechs are driving financial inclusion and competition.

But growth also brings risk. Fintechs, like banks and remittance providers, are exposed to money laundering and terrorism financing threats. Regulators, led by AUSTRAC, are raising the bar for compliance. For fintechs, AML compliance is not just about avoiding penalties. It is about securing customer trust, enabling partnerships, and scaling responsibly.

Why AML Compliance Matters for Fintechs

1. Regulatory Obligation

Under the AML/CTF Act 2006, fintechs offering financial services are classified as reporting entities. They must register with AUSTRAC and comply with AML requirements.

2. Customer Trust

Consumers expect fintechs to be safe and secure. Failing to manage AML risks undermines confidence and slows adoption.

3. Partnerships with Banks

Banks and larger institutions require fintechs to demonstrate robust AML programs before forming partnerships. Weak compliance is a barrier to growth.

4. Fraud and Money Laundering Risks

Fintechs are particularly exposed to mule accounts, synthetic identities, and cross-border laundering through digital platforms.

5. Global Reputation

Strong AML frameworks make it easier for fintechs to expand internationally and align with regulators in other jurisdictions.

AML Challenges Unique to Fintechs

1. Rapid Growth: Scaling quickly often means compliance processes lag behind product development.
2. Limited Resources: Smaller teams may lack dedicated compliance officers or advanced monitoring systems.
3. High Transaction Volumes: Digital platforms process large numbers of small transactions, making suspicious activity harder to detect.
4. Cross-Border Exposure: Many fintechs rely on international payment rails that increase exposure to laundering risks.
5. Evolving Typologies: Fraudsters exploit fintech products in novel ways, from BNPL abuse to crypto laundering.

Key AML Obligations for Fintechs in Australia

1. AML/CTF Program

Fintechs must establish a tailored AML/CTF program that outlines risk management procedures. This includes governance, staff training, and independent reviews.

2. Customer Due Diligence (CDD)

• Verify customer identities before providing services.
• Apply enhanced due diligence (EDD) for high-risk customers.
• Conduct ongoing monitoring to detect unusual behaviour.

3. Transaction Monitoring

• Detect suspicious transactions in real time.
• Configure systems to adapt to evolving typologies.

4. Reporting to AUSTRAC

Fintechs must submit:

• Suspicious Matter Reports (SMRs)
• Threshold Transaction Reports (TTRs)
• International Funds Transfer Instructions (IFTIs)

5. Record Keeping

Maintain records of identity verification and transactions for at least seven years.

6. Annual Compliance Reporting

Submit an annual compliance report (ACR) to AUSTRAC to confirm adherence to AML/CTF obligations.

High-Risk Areas for Fintechs

1. Digital Wallets: Can be used for layering funds.
2. BNPL Services: Attractive to fraudsters using stolen or synthetic identities.
3. Cross-Border Remittances: High risk due to exposure to overseas laundering networks.
4. Crypto Transactions: Increasingly used to obscure fund flows.
5. Peer-to-Peer Lending: Vulnerable to misuse for placement and layering of illicit funds.

Red Flags Fintechs Should Watch For

• Customers transacting at odd hours or in unusual patterns.
• High volumes of small-value transactions designed to avoid thresholds.
• Customers reluctant to provide source-of-funds information.
• Rapid pass-through activity with no account balance retention.
• Accounts linked to multiple devices or IP addresses.
• Transfers to high-risk jurisdictions without clear business purpose.

Best Practices for AML in Fintechs

1. Embed Compliance Early: Design AML processes alongside product development, not after launch.
2. Adopt Real-Time Monitoring: Batch systems cannot keep pace with instant payments like NPP and PayTo.
3. Leverage AI and Machine Learning: Reduce false positives and improve anomaly detection.
4. Automate Onboarding: Integrate digital KYC/CDD tools for efficiency and accuracy.
5. Train Staff Continuously: Keep teams updated on typologies and AUSTRAC expectations.
6. Engage Regulators Proactively: Open dialogue with AUSTRAC helps fintechs stay ahead of compliance trends.
7. Collaborate with Industry Peers: Sharing typologies strengthens resilience against organised crime.

Case Example: Community-Owned Banks and Compliance Innovation

Community-owned banks such as Regional Australia Bank and Beyond Bank demonstrate how even mid-sized institutions can deploy advanced compliance solutions. Fintechs can take inspiration from these banks, which have successfully reduced false positives, improved reporting speed, and strengthened trust through advanced technology adoption.

Spotlight: Tookitaki’s FinCense for Fintechs

FinCense is designed to support fintechs in Australia by combining AML and fraud prevention into one platform.

• Real-Time Monitoring: Detects suspicious activity across NPP, BNPL, wallets, and cross-border corridors.
• Agentic AI: Continuously learns from new laundering typologies, reducing false positives.
• Federated Intelligence: Accesses insights from the AFC Ecosystem, a global compliance community.
• FinMate AI Copilot: Helps investigators close cases faster with summaries and regulator-ready reports.
• AUSTRAC-Ready: Automates SMRs, TTRs, and IFTIs, with full audit trails.
• Scalable Deployment: Works for startups and scaling fintechs as well as larger banks.

FinCense empowers fintechs to grow without compromising on compliance, making it easier to secure partnerships and satisfy regulators.

Future Trends in AML for Fintechs

1. Deeper Integration with NPP and PayTo: Real-time payments will require even stronger monitoring.
2. Crypto Oversight: Stricter regulation of digital asset service providers will shape fintech AML frameworks.
3. AI-First Compliance Teams: AI copilots like FinMate will become standard tools for investigators.
4. Cross-Border Collaboration: Fintechs expanding internationally will need AML programs aligned with multiple regulators.
5. Sustainability of Compliance: Automation will be essential to balance compliance costs with growth.

Conclusion

For fintechs in Australia, AML compliance is not just about satisfying AUSTRAC. It is about building trust with customers, securing partnerships with banks, and enabling sustainable growth. Criminals are exploiting fintech platforms, but with the right tools and frameworks, fintechs can stay ahead.

Community-owned banks like Regional Australia Bank and Beyond Bank prove that strong compliance is possible for institutions of any size. Fintechs that embrace advanced, AI-powered compliance platforms will be better positioned to innovate and scale responsibly.

Pro tip: Make AML compliance part of your fintech’s DNA. It will pay dividends in trust, resilience, and long-term growth.

In a digital-first economy like Singapore, banks must detect fraud faster than fraudsters can adapt.

From social engineering scams and money mules to deepfake-driven impersonations and cross-border laundering, fraud in banking is becoming more sophisticated and high-speed. This has made banking fraud prevention solutions not just a compliance requirement, but a core part of business resilience and customer trust.

This blog explores how Singaporean banks are evolving their fraud prevention strategies, the technologies driving this transformation, and why choosing the right solution makes all the difference.

Understanding the Fraud Landscape for Banks in Singapore

Singapore has one of the most advanced banking ecosystems in Asia, with high volumes of real-time digital transactions. However, this connectivity brings significant exposure to fraud threats.

In recent years, the Monetary Authority of Singapore (MAS) and the Singapore Police Force have flagged several red zones, including:

• Account takeover fraud
• QR code and real-time payment fraud
• Deepfake impersonation scams
• Mule account networks
• Phishing and business email compromise

According to the latest SPF reports, more than half of fraud cases involve some form of unauthorised transaction. This makes banking fraud prevention solutions critical to safeguarding customers and institutions alike.

Key Features of Effective Banking Fraud Prevention Solutions

1. Real-Time Transaction Monitoring

Solutions must detect suspicious activity as it happens. Whether it’s a sudden large transfer, high-frequency small transactions, or cross-border movements, monitoring tools need to catch threats in real time.

2. Customer Behaviour Analytics

Modern systems go beyond static rules. They create behavioural profiles for each customer, flagging deviations in spending, device use, or access patterns.

3. AI and Machine Learning Engines

AI can detect unknown fraud patterns by learning from past behaviours. It also reduces false positives by distinguishing legitimate anomalies from actual risks.

4. Cross-Channel Integration

Effective solutions monitor transactions across digital banking, mobile apps, ATMs, branch operations, and even call centres, all in one platform.

5. Case Management Tools

Fraud detection is only the first step. Prevention solutions must also support investigation, evidence collection, and regulatory reporting.

Common Gaps in Legacy Fraud Prevention Systems

Despite best intentions, many banks in Singapore still face these challenges:

❌ High False Positives

Rules-based engines often trigger alerts for harmless behaviour, overwhelming compliance teams and irritating customers.

❌ Delayed Detection

Legacy systems may take minutes or hours to flag suspicious activity. In real-time payment ecosystems, that delay is costly.

❌ Siloed Intelligence

Fraud signals spread across teams or systems result in missed red flags. Cross-functional visibility is often lacking.

❌ Limited Adaptability

New scam techniques emerge weekly. Static systems cannot adapt fast enough to novel threats such as deepfake-led scams or layered mule networks.

What Top-Tier Banking Fraud Prevention Solutions Look Like

The best solutions offer a combination of detection speed, intelligence depth, and operational ease.

✅ Scenario-Based Detection

Systems like Tookitaki’s FinCense rely on expert-defined fraud typologies, such as layering via remittance platforms or synthetic identity rings.

✅ AI-Powered Alert Prioritisation

Instead of flooding analysts with every alert, the system ranks them by risk, urgency, and likelihood of fraud.

✅ Federated Learning and Intelligence Sharing

Through platforms like the AFC Ecosystem, banks gain access to real-world fraud patterns observed by peers across Southeast Asia, without sharing customer data.

✅ Smart Disposition Engines

Once an alert is raised, tools such as FinMate assist investigators by summarising transaction trails, behavioural red flags, and risk context in plain language.

✅ Real-Time Blocking and Decisioning

The ability to pause or decline a suspicious transaction instantly is key to fraud containment.

How Tookitaki Supports Banking Fraud Prevention in Singapore

Tookitaki’s FinCense is purpose-built for banks and financial institutions in Asia. Here's how it stands out:

• Modular Agentic AI Architecture
  FinCense includes specialised AI agents for fraud detection, alert prioritisation, and investigation support.
• Real-World Scenarios Updated Monthly
  Through the AFC Ecosystem, banks gain access to the latest fraud typologies, from investment scams to tech support impersonations.
• Simulation Mode
  Test new detection rules in a safe environment before going live, to optimise coverage and reduce noise.
• Integration with Core Banking Systems
  FinCense works across digital and traditional channels, ensuring no fraud signal is missed.
• Proven Impact
  Banks using FinCense have reported a significant drop in false positives and faster fraud resolution times.

Checklist: What to Look for in a Fraud Prevention Solution

When evaluating vendors, Singaporean banks should ask:

1. Does it detect fraud in real time, across all channels?
2. Can it adapt to new and localised fraud scenarios?
3. Does it combine AI with explainable, rule-based logic?
4. How does it assist investigators post-alert?
5. Is it MAS and FATF compliant, and audit-ready?

Conclusion: Prevention is the New Differentiator

In a market as advanced and trusted as Singapore’s, banking fraud prevention solutions are no longer an afterthought. They are foundational to customer confidence, operational resilience, and regulatory reputation.

Banks that invest in proactive, intelligent, and scenario-driven solutions will not only stay compliant. They will stay ahead.

Now is the time to upgrade from passive defence to smart prevention.

AUSTRAC’s reporting requirements are evolving, and Australian institutions must keep pace to stay compliant in 2025.

Introduction

The fight against money laundering and terrorism financing in Australia depends heavily on financial intelligence. At the centre of this effort is the Australian Transaction Reports and Analysis Centre (AUSTRAC), which collects, analyses, and shares financial data with law enforcement and regulators.

For reporting entities such as banks, fintechs, remittance providers, and digital currency exchanges, AUSTRAC’s reporting requirements are a cornerstone of compliance. They provide regulators with visibility into suspicious transactions, high-value cash movements, and cross-border transfers.

As we move into 2025, institutions must ensure their systems and teams are aligned with AUSTRAC reporting requirements to avoid penalties, strengthen trust, and maintain operational resilience.

Why AUSTRAC Reporting Requirements Matter

1. Legal Obligation

Under the AML/CTF Act 2006, all reporting entities must submit accurate and timely reports to AUSTRAC. Non-compliance can result in fines running into millions.

2. National Security

Reports provide intelligence that helps disrupt money laundering, organised crime, and terrorism financing.

3. Global Reputation

Australia is a member of the Financial Action Task Force (FATF). Meeting AUSTRAC requirements ensures Australia remains compliant with international standards.

4. Risk Management

Accurate reporting protects institutions from being used as conduits for financial crime.

Who Must Report to AUSTRAC?

Entities that fall under AUSTRAC’s regulatory scope include:

• Banks, credit unions, and building societies
• Fintechs and neobanks
• Money service businesses and remittance providers
• Casinos and gambling operators
• Superannuation funds
• Digital currency exchanges

These institutions are collectively referred to as reporting entities under the AML/CTF Act.

Types of AUSTRAC Reports in 2025

1. Suspicious Matter Reports (SMRs)

SMRs must be filed when a transaction or customer activity raises suspicion of:

• Money laundering or terrorism financing
• Evasion of reporting obligations
• Use of proceeds of crime
• Unclear source of funds

Timeframe:

• Within 24 hours if related to terrorism financing
• Within 3 business days for all other matters

2. Threshold Transaction Reports (TTRs)

TTRs must be submitted for:

• Cash transactions of AUD 10,000 or more
• International equivalents if converted into Australian dollars

Timeframe:

• Within 10 business days of the transaction

3. International Funds Transfer Instructions (IFTIs)

IFTIs cover international transfers into or out of Australia. They must be reported regardless of value, even if the transfer is legitimate.

Timeframe:

• Within 10 business days of the transfer

4. Annual Compliance Report (ACR)

Every reporting entity must submit an ACR to AUSTRAC each year. This report demonstrates:

• How the institution is complying with AML/CTF obligations
• Details of risk assessments and training programs
• Any changes to AML/CTF programs

Timeframe:

• Typically due by 31 March each year (for the preceding calendar year)

5. Ongoing Monitoring and Record Keeping

• Records of customer identity checks and transaction data must be maintained for at least seven years.
• Ongoing monitoring ensures that risk assessments remain current.

AUSTRAC’s Focus Areas in 2025

1. Real-Time Payments and NPP

AUSTRAC expects institutions to adjust reporting and monitoring for instant transactions under the New Payments Platform (NPP) and PayTo.

2. Crypto and Digital Assets

Digital currency exchanges are under closer scrutiny, with reporting obligations tightened to address money laundering and sanctions evasion risks.

3. High-Risk Sectors

Casinos, gambling operators, and remittance providers remain under AUSTRAC’s spotlight.

4. Quality Over Quantity

AUSTRAC has made it clear that the focus is on useful intelligence, not just the number of reports submitted. Institutions must improve the quality and accuracy of SMRs.

Challenges in Meeting Reporting Requirements

• High False Positives: Outdated monitoring systems generate excessive alerts that burden compliance teams.
• Short Timeframes: Especially for SMRs related to terrorism financing, where 24-hour reporting is mandatory.
• Data Integration: Complex IT landscapes make it difficult to aggregate data for reporting.
• Resource Constraints: Smaller banks and fintechs may lack the staff to handle large volumes of alerts.
• Evolving Typologies: Criminals adapt quickly, leaving gaps in detection if typologies are not updated regularly.

Case Example: Community-Owned Banks Meeting AUSTRAC Standards

Community-owned banks like Regional Australia Bank and Beyond Bank are showing that compliance excellence is not limited to Tier-1 institutions. By adopting advanced monitoring platforms, they have improved the speed and accuracy of their reporting obligations.

These banks demonstrate that with the right technology, even smaller institutions can handle complex reporting requirements while keeping compliance costs manageable.

Best Practices for AUSTRAC Reporting in 2025

1. Automate Reporting Workflows: Use software that generates SMRs, TTRs, and IFTIs automatically.
2. Invest in Real-Time Monitoring: Essential for NPP and PayTo-related risks.
3. Leverage AI and Machine Learning: Reduce false positives and focus on genuine suspicious activity.
4. Enhance Data Quality: Ensure transaction data and customer information are accurate and complete.
5. Train Compliance Staff: Regular training ensures staff can recognise red flags and respond quickly.
6. Conduct Independent Reviews: External audits provide assurance that reporting systems are effective.
7. Engage with AUSTRAC: Proactive dialogue with the regulator helps institutions stay ahead of expectations.

Spotlight: Tookitaki’s FinCense

FinCense, Tookitaki’s flagship compliance platform, is designed to simplify AUSTRAC reporting while improving overall AML effectiveness.

• Automated Reporting: Generates SMRs, TTRs, and IFTIs in AUSTRAC-compliant formats.
• Agentic AI: Reduces false positives by learning from real-world typologies.
• Federated Intelligence: Accesses insights from the AFC Ecosystem to catch emerging threats.
• FinMate AI Copilot: Summarises cases and drafts regulator-ready narratives.
• Audit Trails: Provides transparent logs for regulator reviews.
• Cross-Channel Monitoring: Covers transactions across banking, remittances, wallets, and crypto.

By using FinCense, Australian institutions can meet AUSTRAC reporting requirements while reducing operational costs and strengthening resilience.

The Future of AUSTRAC Reporting

1. Greater Automation

Expect AUSTRAC to encourage automation to reduce errors and improve reporting timelines.

2. Real-Time Data Submissions

As payments move faster, near real-time reporting could become a requirement.

3. Expansion of PayTo Oversight

AUSTRAC will likely introduce additional reporting requirements tied to PayTo adoption.

4. Cross-Border Collaboration

AUSTRAC is expected to work more closely with ASEAN regulators to tackle cross-border laundering.

5. AI-Powered Quality Control

Institutions will increasingly use AI to improve the quality of SMRs and reduce noise in reporting.

Conclusion

AUSTRAC reporting requirements are the backbone of Australia’s fight against money laundering and terrorism financing. For institutions, compliance is non-negotiable. The cost of failing to meet reporting obligations goes far beyond fines, impacting reputation and customer trust.

The key to success in 2025 lies in adopting advanced compliance platforms that automate reporting, reduce false positives, and keep pace with AUSTRAC’s expectations. Community-owned banks like Regional Australia Bank and Beyond Bank are proving that effective compliance is achievable for institutions of all sizes.

Pro tip: Do not measure compliance success by the number of reports submitted. Measure it by the quality, accuracy, and timeliness of intelligence provided to AUSTRAC.