Report : Anti-Money Laundering Solution Market Forecast to 2027 - COVID-19 Impact and Global Analysis By Component (Software and Services), Deployment Type (On-premises and Cloud), Product (Transaction Monitoring, Compliance Management, Currency Transaction Reporting, and Customer Identity Management), Industry (Healthcare, BFSI, Retail, IT and Telecom, Government, and Others)
According to the new research report titled “Anti-Money Laundering Solution Market Forecast to 2027 – COVID-19 Impact and Analysis,” published by The Insight Partners, the global anti-money laundering solution market is expected to reach US$ 5,866.51 million by 2027, registering a CAGR of 16.2% during 2020–2027, the forecast period considered in the report. The scope of study involves understanding the factors contributing to the growth of the anti-money laundering solution market; it also includes estimation and forecast of the revenues as well as market size analysis, along with spotting significant market players and their key developments.
North America Accounted for Highest Market Share in 2019
Money laundering among the North American countries have shared concerns, and owing to this, the countries have been addressing the concern by both harmonizing the money laundering norms and enabling financial information sharing among its three key economies. However, there persist several concerns regarding the efficacy of the regulation, as a few market participants criticize it to affect people’s right to privacy. Money laundering in the US is a serious issue. The main reason of laundered funds comes from the accessibility of the financial system. Trade-based money laundering is an alternative method by which criminals have laundered funds in the US. To avoid this, companies are deploying anti-money laundering solutions, which is likely to boost the market globally.
The region comprises a few prominent associations responsible for the designing and implementing the anti-money laundering solution regulation. For instance, the Financial Action Task Force (FTAF) is an intergovernmental organization in North America that creates international policies to battle money laundering. The US, Canada, and Mexico are members of the FTAF and over the years have successfully fulfilled with the recommendations issued by the organization. Herewith, the Financial Intelligence Unit (FININT) of FTAF has enabled the international cooperation to disclose information leading to investigation and prosecution of criminals. With the existence of such regulatory bodies, the region has enabled to significantly attract the demand for solutions that comply with the anti-money laundering solution regulations and allow the businesses to function without any financial perjury.
The stringent regulations in the region are therefore anticipated to enhance the pressure on the industries, particularly the FinTech to pursue for advanced AML software to mitigate money-laundering instances. Also, North America being economically and technologically strong has already attracted numerous AML software and service providers to cater to the market. The region has been projected to continue its demand for AML software for the coming years.
Impact of COVID-19 Pandemic on Anti-Money Laundering Solution Market
North America is one of the most important regions for adopting and developing new technologies due to favorable government policies to boost innovation, a huge industrial base, and high purchasing power, especially in developed countries such as the US and Canada. Hence, any impact on the growth of industries is expected to affect the economic growth of the region negatively. Presently, the US is the world’s worst-affected country due to the COVID-19 outbreak, with 17,515,091 confirmed cases and 313,748 deaths as per WHO. The US is a prominent market for anti-money laundering solutions. Criminals in the region have been exploiting the disturbance created by the global pandemic to gain profits from numerous crimes such as fraud via electronic means, the sale of counterfeit products, and cybercrime. To prevent such threats, communities engaged in action against money laundering are taking measures to identify challenges. International cooperation against terrorist financing and money laundering does not appear to be negatively impacted by the global pandemic.
Key findings of study:
Lately, the financial ecosystem has been transformed by swift developments in machine learning, data science, and their ability to produce algorithms for predictive data analytics. In recent times, machine learning has proved to be holding great promise for the banking system, particularly in the area of detecting hidden patterns and suspicious money-laundering activities. Machine learning facilitates identifying money-laundering typologies, strange and suspicious transactions, behavioral transitions in customers, transactions of customers belonging to the same geography, age, groups, and other identities, and help reduce false positives. It also help analyze similar transactions for focal entities and correlate alerts flagged as suspicious in regulatory reports. The advanced capabilities provided by the machine learning and data science in AML solutions are expected to drive the market.
Furthermore, as money launders continue to explore newer ways to use banks for illicit activities, the timely detection of the laundering activities is the most challenging aspect in implementing an efficient AML. Numerous companies are launching innovative technologies that are capable of detecting, tracking, and preventing money laundering. For instance, in March 2020, Infotech Limited introduced an advanced AML solution—AMLOCK Analytics, which allows banks and financial institutions to recognize complex AML patterns. Powered by AI and machine language, the solution helps enterprises meet the critical challenge of handling a high false positive and deliver a complete view of scrutinizing an alert. The growing use of advanced analytics would control money laundering; thus, it would raise the demand for AML solutions.