Spending on AML/KYC compliance solutions is surging as regulatory pressure is forcing the financial industry to implement fully transparent, verifiable and auditable records as part of their compliance obligations. Clients are exploring automated solutions to support their regulatory obligations, with vendors differentiating their offerings by providing customized solutions that efficiently integrate into existing work flows.
Global spending on Anti-Money Laundering (AML), Know-Your-Customer (KYC) and related financial crime and compliance activities is estimated by Burton-Taylor to have increased 18.3% in 2018 to a record $749 million. Refinitiv remains the largest global provider of AML/KYC data and information in 2018 with total estimated revenues of $247.6 million, accounting for 33.1% of total industry revenues. Dow Jones was the second largest provider of AML/KYC services, while LexisNexis Risk Solutions was the third largest in the industry. New entrants into the market, such as Bloomberg and Kompli-Global, which are included in Other providers in the chart below, also experienced strong growth as global demand for innovative AML/KYC data and information solutions increased.
The Role of Automation
Currently, the main strategy differentiators in the market revolve around the degree of automation of solutions; and the range of areas that the providers choose to address themselves, rather than partnering with an outside provider. For example, Refinitiv has a strong focus on providing managed services, including for due diligence reports. In contrast, LexisNexis Risk Solutions focuses on providing scalable screening platforms in order to help its users to streamline their own processes and does not itself provide outsourcing services for due diligence reports. Other vendors such as Dow Jones Risk & Compliance has extensive entity risk database/feed offerings, while RDC is expanding its focus beyond end-to-end provision of its proprietary risk database to leverage its vast archive of risk-based decisions with a view to improving automation of client decision-making.
While providers in the AML/KYC industry are using different approaches to databases & feeds offered, technology usage and due diligence research, they all have strategies targeted at automating streamlined workflows for clients designed to minimize manual processes and procedures.
2018 Anti-Money Laundering (AML)/Know-Your-Customer (KYC) Study
The Anti-Money Laundering (AML)/Know-Your-Customer (KYC) Market Analysis report provides market positioning profiles for key providers of AML/KYC data and information and related services, with a focus on data coverage, screening and due diligence capabilities. The profiles include their main capabilities, an update on recent and planned developments and information on their market positioning and competitive differentiation.
The complimentary Anti-Money Laundering (AML)/Know-Your-Customer (KYC) Global Share 2018 analysis allows service providers and buyers to compare the performance of AML/KYC data and information suppliers in recent years in a consistent manner to assess relative growth rates, as well as changes in market share and shape over time.
Jennifer Milton is an Analyst at Burton-Taylor International Consulting, part of TP ICAP group, where she is responsible for research, analysis and report generation covering Financial Market Data/Analysis Providers and Anti-Money Laundering/Know Your Customer Data & Information Vendors.