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The Fintech regulatory landscape presents a complex web of shifting regulations and frameworks. However, due to many jurisdictions’ insular approach and companies being unwilling to collaborate on fraud prevention, the knowledge gap has opened up, leading to the anticipated $48 billion loss1 due to fraud in 2023.

Our data shows that over 70% of fraud occurs after onboarding, and many companies still use outdated transaction monitoring processes.

The Fintech Guide That Fraudsters Hate

To tackle Fintech challenges, it’s crucial to grasp the AML regulations in your customer regions and utilize them as innovative guides.

Sumsub has crafted The Ultimate KYC/AML and Fraud Prevention Guide For Fintechs, consolidating all the essential information in one place. The guide covers core global regions, including Africa and its regulatory requirements.

Capitalize On Global Patterns

Understanding the Fintech regulatory patterns is crucial for capitalizing on emerging opportunities. The Sumsub guide highlights how Fintech services, consumer bases, and regulations are transforming the landscape.

As African markets evolve, Sumsub empowers businesses with tools to combat digital fraud and ensure robust protection throughout the customer journey. Sumsub’s internal identity fraud statistics underscore the imperative for companies to integrate advanced fraud prevention mechanisms

1) From Q1 to Q2 2023, Nigeria reported a 46% increase in fintech-related fraud, while in Tanzania, the fraud rate in fintech grew by 150%.

2) Fraud cases within South Africa’s cryptocurrency sector surged by 25% during Q2 2023.

3) A novel threat emerged in 2023 as deepfake fraud surfaced, accounting for 0.6% of all fraud cases in Kenya.

Apply Fraud-Resilient Verification Flows

Sumsub’s guide explains why a generic or ‘tick-box’ approach weakens Fintech risk management strategies and how to strengthen them with dynamic KYC/AML and transaction monitoring, including:

High compliance standards
Jurisdiction-specific automated verification
Full customer lifecycle orchestration
Code-free ease of use

Here is a summary of the stages to deliver world-class verification:

Sign-up and Pre-screening

To expedite registration, users identify themselves by providing their name and country of residence/nationality without submitting any documents.

ID Verification

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Sumsub validates ID documents and double-checks their authenticity using reliable databases available for many countries.

AML and Sanctions Screening

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High-risk clients are identified through AML screening and continually checked against global watchlists and adverse media.

Use Fintech-Customised Transaction Monitoring

Fintech transaction monitoring is integral to the entire verification flow, as every data point helps assessing users, risks, and suspicious patterns.

Sumsub’s Transaction Monitoring solution provides detailed information for each transaction to detect suspicious activities and report if necessary.

Fintech transaction monitoring encompasses the following stages:

Transaction data transfer via secure API.
Real-time ongoing transaction monitoring.
Case management for identifying suspicious transactions.
Suspicious Activity Reports (SARs) for regulatory compliance.

For easy implementation, check out the complete step-by-step guide here.

Key Takeaways

Sumsub’s guide covers Fintech’s best verification practices:

Forget the tick-box approach with in-depth KYC/AML and Transaction Monitoring solutions.
Focus on full-cycle client journeys with continuous Transaction Monitoring.
Consolidate your KYC/AML, KYB, and Transaction Monitoring platforms not to waste time and resources on multiple providers.
100% of Fintechs want consistent client trust while improving compliance, pass rates, and market growth. But how to balance it all?

Read The Ultimate KYC/AML and Fraud Prevention Guide For Fintechs for guidance.