Money services businesses (MSBs) are central to global financial inclusion, supporting communities through remittances, currency exchange and accessible payment services.
Their cross-border reach and high transaction volumes, however, place them under significant regulatory pressure. With regulators intensifying their focus on sanctions enforcement, MSBs need strong and resilient screening processes to protect their operations, claims Alessa.
Sanctions, whether imposed by governments or multilateral organisations, prohibit transactions involving specified individuals, companies or jurisdictions. Major regimes include those issued by the United Nations, OFAC in the US, the EU and the UK’s OFSI. For MSBs, failing to screen customers and transactions against these lists can lead to fines, licence revocations and lasting reputational harm. A comprehensive screening framework is therefore essential to minimise exposure and maintain regulatory trust.
An effective sanctions programme helps MSBs maintain compliance, avoid penalties and safeguard their partners and customers. Strong frameworks rely on a systematic approach that governs how screening is conducted across every service channel, from agent-facilitated cash transfers to digital wallets and online payments. At the heart of any programme sits risk-based screening, where enhanced due diligence is applied to higher-risk services such as cross-border transfers or foreign exchange. MSBs must also ensure full list coverage, screening against OFAC, UN, EU and OFSI lists, and any additional local lists relevant to the markets they serve.
Technology plays a critical role in helping MSBs keep pace with regulatory expectations. Name-matching algorithms and fuzzy-logic screening tools can detect variations, transliterations and aliases that manual reviews would often miss. To satisfy regulators, firms must also establish clear escalation procedures and maintain audit-ready documentation demonstrating how alerts are reviewed and resolved. Regular training ensures that both compliance teams and agent networks understand sanctions rules and can operate systems with confidence.
A detailed sanctions checklist offers MSBs a structured way to assess and strengthen their frameworks. Governance begins with defining a clear policy, identifying relevant sanctions regimes, assessing risk exposure and ensuring that list updates are captured in real time. Accurate data collection is equally important. MSBs need reliable information on senders, recipients and agents, integrated directly into onboarding and transaction systems. The use of standardised and validated data reduces false positives and improves overall screening efficiency.
The execution of screening requires robust technology configured with risk-based parameters. MSBs should conduct both real-time and batch screening, document all alerts, and follow pre-defined escalation criteria when handling potential matches. Ongoing monitoring, system testing, continuous list updates and recurring staff training ensure that screening programmes remain effective as regulatory expectations evolve. Internal audits help identify gaps and strengthen governance.
When alerts arise, MSBs must follow disciplined procedures. This includes gathering additional information, determining whether alerts constitute true or false matches, escalating findings according to policy, documenting outcomes and reporting confirmed breaches to regulators without delay. Transparent record-keeping is essential for demonstrating compliance.
MSBs operate in a highly scrutinised area of financial services, making strong sanctions screening essential for protecting trust and ensuring sustainable growth. By investing in advanced technology, risk-based frameworks and well-documented processes, MSBs can streamline compliance while continuing to support global financial inclusion. Platforms such as Alessa provide real-time screening, automated workflows and complete audit trails, helping compliance teams meet their obligations with greater efficiency.
A proactive, well-maintained sanctions programme protects businesses from enforcement actions while reinforcing their commitment to transparency and financial integrity.
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