Mastercard Launches TRACE in the Philippines: Revolutionizing Real-Time Payments to Combat Money Laundering

Mastercard has recently launched its innovative AI-driven financial crime detection solution, TRACE (Trace Financial Crime), in the Asia Pacific region, specifically in the Philippines. This groundbreaking system aims to enhance the security of real-time payment (RTP) networks, which are becoming increasingly popular as they allow for instantaneous transactions between financial institutions.

TRACE Launches in the Philippines

The TRACE solution is now implemented within the Philippines’ RTP network, thanks to a collaboration with BancNet, the country’s local interbank network. This makes the Philippines the second country worldwide to adopt TRACE, following the initial implementation in the United Kingdom.

Rising Demand for Real-Time Payments

The demand for RTP transactions is accelerating across the Asia Pacific region, enabling individuals and businesses to complete payments in seconds. However, this rapid transaction speed poses challenges, making RTP systems prime targets for money laundering and fraudulent activities.

Combating Financial Crime with AI Technology

Mastercard, a leader in secure payment solutions, has integrated AI capabilities into TRACE to combat financial fraud effectively. In contrast to traditional methods that often rely on semi-manual processes or internal AI tools, TRACE utilizes advanced data science to analyze transactions across the entire payments network, identifying suspicious activities more efficiently.

• Real-Time Alerts: TRACE provides immediate notifications to banks regarding suspicious accounts and potential money mule activities.
• Collaboration with Banks: BancNet has already integrated TRACE with 36 domestic banks, enhancing their ability to trace illicit funds.
• Compliance with Regulations: The initiative aligns with the Philippines’ new Anti-Financial Account Scamming Act (AFASA), reinforcing financial security.

Global Impact of TRACE

TRACE is a network-agnostic solution that can easily integrate with various RTP systems throughout the Asia Pacific. Since its launch in the UK in 2018, TRACE has been adopted by 21 financial institutions, covering approximately 90% of the UK’s Faster Payments Service network. This solution has successfully identified thousands of mule accounts and continues to reveal hundreds of fraudulent accounts monthly.

Expert Insights

Matthew Driver, Mastercard’s Executive Vice President for Services in Asia Pacific, stated, “The launch of TRACE in Asia Pacific marks a transformative step toward safeguarding the integrity of Real-Time Payments while combating the corrosive effects of financial crime.” He emphasized the importance of maintaining secure transactions to foster trust in the digital economy, which is crucial for regional economic growth.

Emmie Reyes, CEO of BancNet, echoed this sentiment, highlighting that advanced technology is essential for detecting fraud more swiftly. Through their partnership with Mastercard and the implementation of TRACE, BancNet and its network participants are better equipped to prevent scams.

Conclusion

The introduction of TRACE in the Asia Pacific region underscores Mastercard’s ongoing commitment to enhancing financial security on a global scale. As financial crime tactics evolve, AI-driven solutions like TRACE will play a pivotal role in safeguarding digital payment systems and protecting consumers.

For more information about Mastercard’s initiatives, visit their official website.