International payment network Terra is collaborating with LexisNexisÂ® Risk Solutions, a global big data, technology and analytics company, to protect its network against financial crime and facilitate secure growth of mobile-powered cross-border transactions, the company said.
The globalization of financial markets and the growing move to digitize remittances have made it easy to move funds to any corner of the world. With an increase in the volume of activity, there is a heightened need to safeguard money transfer networks from potential money laundering and to strengthen compliance.
In the wake of intensifying regulatory requirements and strict compliance controls, combating money laundering and fraud represent a major challenge for international money transfers. Globally, service providers continue to grapple with mounting complexity and costs of compliance — resources, time and money — which, in turn, raises barriers to entry for new players and impacts growth of existing players. According to industry estimates risk management and other costs tied to AML compliance have risen more than 50 percent year-on-year.
Terra interconnects mobile wallet service providers, banks and remittance companies to build a global network to serve remittance-dependent households in regions with low banking penetration, primarily Asia, Africa and Latin America. The ability to implement effective measures to protect service integrity whilst balancing escalating compliance cost pressures is crucial to attract partners, achieve rapid scale and drive adoption of formal remittance products.
International money transfer networks inherently span multiple jurisdictions and variations in Customer Due Diligence and Know-Your-Customer processes across countries make services susceptible to misuse. Working with LexisNexisÂ® Risk Solutions provides a robust, first-line of defense to secure transactions processed over the Terra network. LexisNexis Risk Solutions deploys state-of-the-art intelligence tools to provide an end-to-end customer screening service that detects and assesses the compliance and business risks of customers behind a transaction, as well as monitors counter-parties for risk profile changes.
LexisNexis Risk Solutions delivers actionable information on potentially risky transactions to enable informed authorization decisioning in real-time. For example, Terra can proactively block suspicious transactions based on the originator or the beneficiary´s risk score. By conducting payer and payee risk assessments on a global scale, participants on the Terra network derive the maximum leverage of knowledge from different law enforcement and supervisory authorities, which strengthens domestic monitoring and compliance to build a secure transaction environment.