Anti-money-laundering rules turn every cross-border wire into a small compliance event. For ordinary customers this is irritating but unavoidable. Understanding the rules helps you avoid friction.
Banks are required to know the purpose of payment (UK, EU, US, AU, NZ, CA all have similar rules). Field 70 of an MT103 captures this; corporate clients often include invoice numbers or contract references.
For amounts above a threshold (often 10,000 USD equivalent for retail, lower for some jurisdictions), banks file Currency Transaction Reports / Suspicious Activity Reports as needed.
For first-time payments to a new beneficiary, banks often require enhanced due diligence: relationship to the recipient, source of funds, supporting documentation (invoice, contract).
For payments to high-risk corridors (Iran, North Korea, Cuba — sanctioned; plus some FATF grey-listed countries), additional checks apply or the payment may be rejected outright.
For corporate clients, the bank typically maintains a "white list" of regular beneficiaries that have been pre-cleared, reducing per-transaction friction.
If your bank asks for additional documentation, respond promptly — most AML holds resolve in 1-2 business days with the requested info. Resistance only extends the delay.
Periodic re-due-diligence — banks must refresh KYC every 1-3 years on active customers. Even known recipients can trigger refresh.
Yes — banks have discretion under "de-risking" policies. Recourse is the complaints process and ultimately changing banks.
Invoices, contracts, beneficiary KYC info, the MT103 confirmation. Retain for 5-7 years per typical AML rules.
No — fintechs apply the same AML rules and often more aggressively because they have less customer history.