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Key Issues for Consideration during Mutual Assessments
may consider within the broad framework of the current methodology and a number of matters that may be included when the methodology is revised. The methodology prescribes an assessment process that is already time and resource intensive. Therefore, this discussion tries to be comprehensive in identifying relevant topics, without adding unduly to the burdens of countries being assessed or the assessors undertaking evaluations.
Background In general terms, “financial inclusion” refers to access to appropriate financial products and services for everyone needing them, especially lowincome populations. Many countries around the world are exploring ways to make appropriate financial services economically affordable and accessible to these populations. In various jurisdictions, however, many potential customers are unable to provide reliable documentary proof of personal data, such as evidence of their residential addresses or their identification cards. As a result, some of the concerned countries have tailored specific know-your-customer (KYC) regulations to facilitate the extension of financial services to people not currently served. These regulations often simplify customer due diligence (CDD) obligations regarding this particular segment of the population—in most cases, according explicitly or implicitly to the risk particular potential customers pose. FATF assessors frequently debate the extent to which such simplified CDD regulations meet and advance the objectives of the international standards. The debates extend to the assessment of new role players in services that are targeted at the low-income segment of the population. The rapid development of m-money services has brought many nontraditional financial service providers, such as telecommunications companies (telecoms) and retail outlets, into the AML/CFT framework. AML/CFT evaluations, therefore, should consider whether these entities are relevant in a specific country. Because the FATF methodology does not provide explicit guidance on their assessment, assessors require guidance on AML/CFT and financial inclusion and on more detailed technical issues relating to m-money. In that regard, the World Bank and a few FATF-style regional bodies (particularly, the FATF of South America—GAFISUD—) have started to explore what type of guidance assessors require to integrate financial inclusion questions into the assessment process. The following discussion is a contribution to that effort. It aims, in particular, to identify key questions that should be considered when assessing the conformity of