Compliance with in the EU is an essential component in the operational strategies of many payment service providers in the region. It is through effective and proactive compliance strategies that these companies are able to avoid hefty noncompliance fines while in the process reducing exposure to financial crimes. However, developing a proactive compliance strategy that is dynamic to the changing risks in the market requires a lot of effort and there are a few tips that can help financial services providers to achieve their compliance goals. Here are some of these tips:

Risk-Based Strategies

The strategies that are developed to aid in the compliance with regulatory obligations in the financial markets must all be risk-based. It is important to note that the role of compliance is to minimize the risks of exposure to financial fraud. It is based on this that all compliance strategies must be driven by the real risks in the market. When payment service providers are aware of the risks they face in their operating environment, it becomes easier for them to put in place measures to mitigate them.  This also helps to ensure that all rules in the market are complied with.

Adopting Best Practices In The Market

Compliance with rules in the financial services industry is a very dynamic thing. Payment services providers and other players in the market are always innovating new and better ways to meet their regulatory obligations and over the last few years, there has been a rapid increase in the development of new capacities within these organizations to effectively comply with EU directives on anti-money laundering. It is extremely important to know what other companies are doing in compliance and see whether there is anything to learn. The biggest knowledge in compliance comes from peers in the industry who are doing a great job at it. If you can learn and adopt best practices in the market, it is very likely that indeed your company will also see a great deal of success as far as compliance goes.

Investing On Technology

Compliance tracking and transaction monitoring is a big part of the overall effort to meet regulatory obligations. Payment service providers can only stop transactions that are not aligned with the rules if they are able to detect them. The setting up of compliance tracking and monitoring system is therefore highly recommended. There are many world-class tracking and transaction monitoring solutions these days. Investing in such a system gives you a real-time oversight of every transaction so that even if there was to be an attempt of noncompliance, you will easily detect it and deal with it. Investing on a compliance tracking and transaction monitoring system is, therefore, a must.

The dynamic nature of the financial markets means that risks keep changing all the time. The rules too that are designed to govern operations in the market keep changes. To stay ahead of the game and comply with everything, you need to be proactive. Talk to Trapets today for more on compliance monitoring and tracking.