
Digital Wallet Fraud | How AML Screening Solution Can Help

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Digital wallets are becoming everyone’s go-to transaction method and the total number of e-wallet users was 3.4 billion in 2022, further forecasted to reach 5.2 billion worldwide by 2026.
Besides generating revenue, it is becoming a hotspot for criminals and causing reputational damage to businesses. That’s where AML screening solutions come in—a reliable way to protect digital assets.
Digital wallets enable users to link all their payment methods under a single account. The account stores funds, credit card numbers, and even cryptocurrencies and these wallets are accessible online through a smartphone or a website.
The main feature of e-wallets is that all information related to transactions is encrypted and tokenised. This enhances security and an individual’s privacy but also leaves the merchants in vain as they can not spot credit card scams.
eWallet firms pose a risk of money laundering and other crimes due to the anonymity provided by online financial services. Not only this but other aspects, such as the speed of transactions and lack of regulations from domestic and global authorities may also contribute to it. In detail, those risks involve:
One or two fake transactions may not wreak havoc on a company but the issue arises when transactions are recurring. They commit crimes at scale causing digital wallets to lose a large amount of money fast.
Besides financial costs, digital wallets also impact the customer experience and put a dent in brand reputation. Moreover, fraud victims take it to social media, scaring off potential customers. Thus, e-wallet services must abide by AML regulations to keep scammers at bay, protect customers and the company’s image, and avoid the risk of large non-compliance fines.
The Financial Action Task Force (FATF) sets out an Anti Money Laundering and Countering Terrorist Financing (AML/CFT) framework for the member states to implement in national legislation. This means that all the companies, including digital wallet service providers, have a legally obligated to conduct comprehensive risk assessments of their clients and modify their AML response proportionately. In practice, eWallets should include the below-mentioned measures to satisfy AML regulations:
Digital wallet service providers should look out for the following “red flag” behaviours to improve AML compliance.
Shufti Pro’s AML screening solution helps e-wallet companies guard their platforms against money laundering and other financial crimes. Shufti Pro offers AML services to 230+ countries and territories with an accuracy rate of more than 99%.
Here’s what makes Shufti Pro’s AML solution stand out:
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