The UK government has decided to remove account information service providers (AISPs) from anti-money laundering regulation.
Last year, the Treasury launched a consultation on amendments to money laundering regulations in which it proposed excluding AISPs from the regulated sector after assessing that they posed a low risk because they do not come into direct contact with customers’ funds.
Respondents to the consultation have backed the move, with 65% of 29 responses supportive of the removal. Among the observations made were that AISPs are unlikely to influence any kind of activity that could give rise to money laundering and that there is no evidence that criminals are using AISPs for the purpose.
Open banking giant Plaid says the decision will be a “boon” for the industry, with European policy lead Dan Morgan arguing: “The decision resolves a long period of uncertainty for UK open banking, given there never was clear ML risks have been identified for AIS providers.
“Now, startups will be able to innovate more quickly and bring open banking-based products and services to market much faster, ultimately to the benefit of consumers and SMEs across the UK.”
Elsewhere, the Treasury has decided to keep payment initiation service providers (PISPs) within the regulated sector, despite some support for their removal. While the money laundering risks associated with PISPs are “relatively low” they are higher than those associated with AISPs, says the government.