Bankloch

In my previous blog, " Smarter Together: How Data Sharing Will Transform Financial Services " ( https://bankloch.blogspot.com/2026/01/smarter-together-how-data-sharing-will.html ), I described how the financial sector has enormous untapped value in cross-institution collaboration. Fraud detection, KYC and AML, credit intelligence, Verification of Payee, smarter payment routing…​ the potential is massive. But there is a hard truth:   data sharing only works if privacy works . And privacy in financial services operates on two very different levels. The First Level: Customer Control & Trust Customers do not want their financial lives circulating across institutions without explicit control. Even when they give consent, they expect: The right to revoke it The right to be forgotten Full transparency on who accesses their data Clear purpose limitation This is not just about complying with GDPR. It is about   trust . And trust, once lost, is almost impossible to rebuild. The Sec...

Despite enormous investments in Anti-Money Laundering (AML) detection - from advanced monitoring systems to large compliance teams - money laundering remains alarmingly persistent. Criminals stay several steps ahead, while financial institutions find themselves trapped in a game of "compliance theatre". AML detection is inherently difficult: money launderers are agile, adaptive, and operate across borders and institutions. But the real challenge lies not just in complexity - it’s in the misaligned incentives and checkbox mentality that dominate the system. Financial institutions are required to: Implement a predefined set of   detection rules   (which are often public knowledge among criminals) File   Suspicious Activity Reports (SARs)   when certain patterns or thresholds are triggered The cost of AML is staggering compared to its measurable benefits. For example, in the Netherlands, it’s estimated that around 20% of bank employees - roughly 13,000 people - are enga...

  Regulatory pressure remains one of the most critical challenges facing financial institutions today. Regulations differ by country, are often vague or even contradictory, and continue to evolve - whether through the introduction of new rules or updates to existing ones. At the same time, regulators are becoming significantly more demanding, both in terms of timing and evidentiary requirements. Regulatory expectations have intensified in two distinct but interrelated ways: Tighter Deadlines : Where monthly reporting and multi-week response times were once acceptable, regulators now expect reports daily and responses almost immediately. This shift demands real-time access to compliant, trustworthy data across systems. Deeper Evidence Requirements : Historically, banks were only required to explain exceptional transactions. Later, regulators began requiring documentation of internal processes and procedures. However, documentation alone wasn’t enough - regulators couldn’t verify whe...

Belgium is currently in the midst of forming a new government, a process known for its length and complexity. As we face yet another challenging government formation, a significant debate has emerged around the introduction of a   capital gains tax on profits from the sale of equities   that are currently untaxed in Belgium. The proposal suggests a tax rate of around 10% on these profits. Whether this is a good or bad idea is up for debate. Given the dire state of the government’s finances, exploring new revenue sources is certainly on the agenda, especially as Belgium remains one of the few countries without such a tax. However, this article focuses on the practical implementation of such a tax. While the concept may seem straightforward, a deeper dive into the details reveals a host of complexities. Let’s start with a basic scenario: an individual buys shares for €100 and later sells them for €150. The profit is €50, which, under a 10% capital gains tax, would result in a €5...

Over the past two decades, the banking industry has faced staggering penalties for non-compliance, totaling an astonishing $387,559,149,283 (source: Violation Tracker). This colossal sum underscores a pressing issue: despite numerous efforts, the financial sector continues to grapple with compliance, with no signs of the penalties decreasing. Every day, new reports surface of financial institutions being fined by regulators worldwide. The challenge of achieving compliance in the financial sector cannot be overstated. Regulations are inherently complex, often ambiguous, and vary significantly across different countries and regions. This complexity is compounded by the rapid pace at which new regulations are introduced. For instance, the European Union has recently implemented or is defining several new regulations such as the Digital Operational Resilience Act (DORA), Payment Services Directive 2/3 (PSD2/3), Markets in Crypto-Assets (MiCA), Central Electronic System of Payment Informati...

Financial institutions face increasing challenges in combating financial crime. While technology has significantly advanced (e.g. thanks to AI), the methods employed by criminals have also evolved, becoming more sophisticated and harder to detect. One of the crucial challenges in this battle is the siloed approach to detecting and combating financial crime. Financial crime information is rarely shared between banks and even within various departments of a single bank, such as cybersecurity, risk, compliance, fraud, operations, and customer support. Despite these departments common goal of reducing financial crime, each department focuses on different aspects. For example, cybersecurity teams focus on protecting the bank’s digital infrastructure, compliance ensures regulatory adherence, and fraud teams detect and prevent fraudulent activities. Consequently, these departments often do not share information, leading to missed opportunities to identify and mitigate risks. A centralized dat...