NBU recommended banks to strengthen financial monitoring: what will change for clients

The National Bank of Ukraine has published new recommendations on financial monitoring, which include strengthening control over clients’ financial transactions. The purpose of the changes is to increase the transparency of the banking system, reduce the risks of money laundering and prevent the financing of illegal activities.

What the NBU recommends

According to the regulator’s recommendations, banks should more carefully analyze the financial behavior of their clients and apply a risk-based approach when assessing transactions.

In particular, financial institutions are recommended to:

more carefully check transactions that do not correspond to the client’s usual financial profile;
more often analyze transactions of clients with an increased level of risk;
require more detailed confirmation of the origin of funds in cases provided for by law;
strengthen internal control procedures and automatic detection of suspicious transactions;
pay special attention to large payments and transactions without an obvious economic purpose.
Why are the changes being introduced

The National Bank notes that the updated recommendations are part of the adaptation of the Ukrainian financial monitoring system to international standards.

It is expected that the strengthening of control will help increase the effectiveness of the fight against money laundering, strengthen confidence in the banking system and contribute to its resilience in the face of economic challenges.

At the same time, the NBU’s recommendations are aimed primarily at improving banks’ internal procedures and do not mean the automatic introduction of new restrictions for all customers.