Voice of the Industry

Financial crime threats: how is Railsr ensuring AML & KYC compliance and protecting digital services?

Monday 8 August 2022 09:30 CET | Editor: Raluca Ochiana | Voice of the industry

Walter Hogg, Head of Compliance and Risk UK & Europe at Railsr, reveals how to fight the criminal element that strives to part consumers from their money to create a safer ecosystem.

A frictionless, fast, and painless customer onboarding experience. Ensure appropriate due diligence, aligned to local and international standards, and compliant with regulations. Help consumers access innovative financial services conveniently and safely. 

Sounds easy when you say it, and bread-and-butter to any regtech firm worth their name, right? Easy to say, not as easy to do!

The boom in digital financial services is great for consumers, a headache for regulators, and challenging for the breed of firms that we call ‘fintechs’. The egalitarian vision of providing financial services to so-called ‘unbanked’ or ‘thin-file’ consumers who have previously been ignored by traditional banking institutions is admirable - but not without its challenges. 

What has ensued over the last handful of years is a financial services revolution which is fast redefining what ‘financial services’ means. The tired and outdated ‘traditional’ providers are fast disappearing in the rear-view mirror.

However, what is a constant is the ever-present - and innovative as ever – criminal element that strives to part consumers with their money. The impact remains constant: an undermining of the integrity of the financial services, consumer confidence is being shaken, and a real impact on people’s lives.

So, that’s been the problem cornered, but how does Railsr address the challenges?

At Railsr we understand these challenges - we have a deep understanding of our customers, the end-users they seek to serve, and of course, the often unique and revolutionary products which our customers bring to market. Now, wrap around these elements a swath of regulation - the aim of which is ultimately to protect consumers - and you have a lively and robust ecosystem that market participants are starting to appreciate, and access, more and more. Sounds sensible, but it is a vastly under-appreciated concept! 

It seems that just about everything these days happens at break-neck speed, and the ambition for customers to access embedded, cutting-edge technology swiftly and safely, is no exception. This matches our ambition at Railsr: focus on the customer, provide innovative solutions, and balance our risk management with our industry-leading technology to launch and scale financial products that are directly embedded within the customer's own user experience. 

Our onboarding and due diligence protocols include cross-jurisdictional requirements, and our software deployment includes eID and document verification, PEP, sanction, and adverse media screening at the entry point, at the same time generating a customer risk-score which influences our ongoing monitoring obligations. We try to do as much as we can ourselves, with as minimal disruption to the customer as possible. Gone are the days of a heavily manual customer onboarding process that leaned heavily on ‘traditional’ data to perform checks, multiple form-filling, hardcopy files, manual verifications, and ‘live’ identification checks. 

‘Financial inclusion’ is not just a buzzword to Railsr. By way of example, when almost 3 million young adults just in the UK (aged 20-34) still live in their parent’s home, the industry needs to find a solution for these would-be consumers who would traditionally find it challenging to ‘qualify’, simply because they are unlikely to be named on a utility bill or a mortgage deed. Now extrapolate this globally.

Is the lack of the ‘right’ documentation in the ‘right’ format required by legacy financial service providers to assess creditworthiness and perform consumer due diligence reason enough not to service a consumer? This is 2022 - we live in the digital age, and time and convenience are commodities. Safety and robust risk controls do not have to be sacrificed in favour of speed and a good customer experience.

Tech is in Railsr's DNA, and we use it for the mutual benefit of the customer experience and in meeting our regulatory obligations. That said, behind the ‘tech’ we recognise that experience and human instinct are invaluable in the fight against financial crime. The ability to analyse data and trends and determine the ‘why, what, when, and where’ is most effectively used when experienced financial crime professionals use their shared experiences and ‘war-wounds’ to dig deep into the ‘nitty gritty’ of customer behaviour.

Railsr has invested heavily in creating an integrated and coordinated financial crime prevention approach. Firstly, customer engagement and initial assessments of suitability are managed by our highly skilled customer success and sales teams… ‘are we a good match for our prospective customer, and can we make this work for them’. This customer engagement is underpinned by appropriate control measures of due diligence, performed by our customer launch team, without compromising on the customer experience. Where we don’t compromise is in meeting our internal standards and in meeting regulatory expectations. Our risk assessment process is crucial in establishing ‘what comes next’.

Once we’re over the hurdle of ‘are we dealing with good guys or bad guys’, our compliance functions augment the work of our ‘launch’ colleagues, with dedicated resources pointed at transaction monitoring, financial intelligence analysis, compliance, AML, and ongoing customer supervision. 

Railsr places emphasis on collaborative thinking and always being curious to solve issues and deal with problems. The various teams work seamlessly to leverage technology and human ingenuity to solve the day-to-day challenges of how to disrupt the bad guys – ‘the whole is greater than the sum of its parts’


This editorial was first published in our Financial Crime and Fraud Report 2022, which showcases the innovation and development of the best practices and instruments used by financial institutions in their fraud prevention activities, to improve the digital onboarding process of their customers while fighting against financial crime. 


About Walter Hogg

Walter Hogg is the Global Head of Compliance and Risk at Railsr. A Qualified Accountant, Walter has more than 30 years of experience in Compliance, Anti-Financial Crime, Operational Risk and Audit disciplines within complex global financial institutions.




About Railsr

Railsr is the global leader in Embedded Finance Experiences. It is passionate about enabling brands to build relevant finance experiences to drive customer engagement and loyalty. Railsr was founded in London (HQ) in 2016 and operates throughout the UK, Europe, APAC, and the US.

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Keywords: financial crime, fraud prevention, AML, KYC, regtech, financial inclusion
Categories: Fraud & Financial Crime
Companies: Railsr
Countries: World
This article is part of category

Fraud & Financial Crime


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