FATF updates standards on payment transparency

The Financial Action Task Force (FATF) has published revised standards and an accompanying explanatory note, updating its comprehensive framework on recommendations to strengthen global efforts in anti-money laundering, counter-terrorist financing and counter-proliferation financing, as announced during the joint FATF-MONEYVAL Plenary meeting. The FATF update includes amendments to Recommendation 16, which governs the transparency of wire transfers through the payment chain and is commonly referred to as the "Travel Rule." The revised recommendation is aimed to modernise FATF standards in response to the evolving payments landscape, which now includes a broader range of products and services, technologies and business models.

The changes to the standards are described below.

• Clarification of responsibilities within the payment chain, specifying who is accountable for including and maintaining information in payment messages and ensuring it remains unchanged to support secure payments. Under the new standard, the payment chain begins with the financial institution that receives the customer's instruction.
• Implementing standardised requirements for peer-to-peer cross-border payments exceeding USD/EUR1,000, requiring the inclusion of the sender's name, address and date of birth to improve transparency and aid in detecting suspicious transactions.
• Requiring financial institutions to adopt new technologies, that protect against fraud and error, such as tools to verify recipient banking information—many of which are already in use in some jurisdictions.
• Clarifying the scope of 'purchase of goods and services' on card transactions while maintaining the exemption of such transactions from the full requirements of Recommendation 16.

The changes will take effect by the end of 2030, with the FATF committed to issuing guidance and maintaining active engagement with the private sector to support the industry in preparing for them.

Return to main website.