FATF updates guidance on financial inclusion and AML measures

The update supports countries and the private sector in bringing more individuals into formal finance through risk-based approaches to defeating illegal activities. The FATF also strengthened its Recommendation 1 earlier in 2025 to encourage countries to promote financial inclusion and to reinforce the expectation that AML, CFT, and CPF controls have to be implemented through a proportionate and risk-based process.

Risk-based approach for financial inclusion

The update reflects that fighting against financial crime and for financial inclusion are initiatives that mutually support each other. Improved sector transparency and integrity maximise the reach of AML, CFT, and CPF measures, facilitating law enforcement investigations.

Representatives from the FATF believe that bringing more people into the formal financial sector is key to fighting against financial crime because it reduces the size of the black markets where criminals hide their operations. However, it also addresses an injustice in the eyes of FATF, as financial exclusion largely affects individuals in disadvantaged and vulnerable communities and, in most cases, these people are excluded from financial services due to cost or lack of formal documentation.

The update underwent public feedback gathering over 100 responses, including civil society, academia, and the public and private sectors, and it contains case studies from around the world. It focuses on offering access to formal services by underserved people, such as individuals in low-income and rural groups, fragile contexts who may lack easy means to verify their identities, and those who are underserved by existing financial products and services.

The task force expects countries to implement AML/CFT/CPF measures through a risk-based approach, considering the risks of financial exclusion and the benefits of bringing individuals into the regulated financial system. This assessment will enable countries and institutions to offer appropriate financial services to those who need them and apply measures for high-risk scenarios.

The FATF Guidance includes examples of supervisors, policy-makers, and associations that have implemented the risk-based approach, including in countries such as Sweden, Singapore, and the Netherlands.