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Gig workers 2047 report

Gig & Platform Workers Vision 2047 Report: Key Takeways

India stands on the cusp of a new workforce revolution. As the country sets its sights on becoming a Developed Nation by 2047, the gig economy is expected to play a major role in shaping the nation’s future. In fact, according to the VV Giri National Labour Institute’s report, “Gig and Platform Workers: Vision 2047,” gig workers are projected to make up 14.89% of India’s non-agricultural workforce by 2047, a sharp rise from 2.6% in 2020-21.

This transformation is driven by several key factors: demographic shifts, the rise of technology, and the growing preference for flexible, project-based employment. In the next two decades, India’s gig workforce is expected to expand significantly, offering millions of workers opportunities to contribute to the economy in dynamic ways.

At the heart of this transformation is the platform economy, digital platforms that enable individuals to find short-term, task-based jobs. These platforms have disrupted traditional work patterns, enabling a global workforce to connect and collaborate in previously impossible ways.

But as businesses increasingly turn to gig workers, they must manage the unique challenges that come with managing a temporary, informal workforce. The report highlights not only the enormous growth potential of gig work but also the regulatory, economic, and social challenges that businesses and gig workers will face in the coming years.

The Gig Economy’s Rise

India’s gig economy is a rapidly expanding sector that is set to become a major contributor to India’s labour market by 2047. The report offers critical projections and data that highlight the transformative potential of gig work in India.

Gig Workforce Growth

As of 2020-21, India had approximately 7.7 million gig workers, constituting 2.6% of the non-agricultural workforce. Fast forward to 2047, and it’s projected that India’s gig workforce will reach 61.6 million, making up 14.89% of the non-agricultural workforce. This growth represents an increase of over sevenfold in the next 17 years, driven by several key factors, including digital platforms, technological advancements, and an increasing shift towards non-traditional work arrangements.

Contributions Of The Gig Economy To GDP

The gig economy is expected to make a significant economic contribution. As highlighted in the report, the total transaction volume of the gig economy in India could reach $250 billion by 2030, contributing 1.25% of GDP. 

The digitalisation of India’s economy will be a primary catalyst for this growth. As more sectors, such as healthcare, education, and consulting, embrace digital platforms to meet their needs, the gig economy will continue to expand its footprint across industries.

Drivers Of Gig Economy Growth

Several factors are driving the gig economy’s rapid rise:

  1. Technological Advancements: The expansion of smartphone use, internet penetration, and the development of platform technologies have made gig work more accessible.

  2. Digitalisation of Services: Platforms are expanding their reach, offering more gig roles across various sectors such as transportation, food delivery, household services, and personal care.

  3. Rise of Remote Work: The COVID-19 pandemic accelerated the adoption of remote work, further cementing the role of gig work in sectors such as IT, design, and writing. Remote work offers flexibility, which is one of the most attractive features of gig employment.

  4. Youth and Female Participation: As highlighted in the report, youth and women are embracing the gig economy, driven by the flexibility it offers. This has allowed women to break into traditionally male-dominated sectors like driving and handyman services.

Another interesting observation from the report states that the gig economy is not just confined to the metros; it is spreading across tier-2 and tier-3 cities as well. This regional distribution highlights the inclusive nature of the gig economy and its potential to provide income-generating opportunities across the country.

Challenges And Risks In The Gig Economy

While the gig economy offers substantial growth opportunities, it is not without its challenges. These challenges need to be understood by businesses that rely on gig workers for their operations. The report outlines several key issues that are critical to the future of gig work in India.

1. Informality of Gig Work: Lack of Social Protections

One of the most pressing issues within India’s gig economy is the informality of gig employment. According to the report, 82.5% of gig workers in India are informal employees. For instance, in a traditional employment model, workers are usually eligible for:

  • Maternity benefits

  • Health insurance

  • Pension plans

  • Paid sick leave

However, gig workers are typically excluded from such schemes due to their informal status. As a result, many gig workers, especially in sectors like ride-sharing, food delivery, and household services, lack adequate healthcare and sick leave protections. In the post-pandemic era, the absence of health insurance and other protections has become a critical issue, especially for high-risk workers like delivery personnel or drivers.

Without access to social benefits, gig workers are more vulnerable to financial instability in the event of an accident, illness, or economic downturn.

2. Wage Disparities: Income Inequality Among Gig Workers

The wage gap in the gig economy is another significant challenge. The report indicates that women gig workers earn less than their male counterparts. This wage disparity is particularly pronounced in female-dominated sectors such as beauty work, cleaning, and caregiving.

Gender-based wage gaps exist because women are often pushed into lower-paying roles, which typically require less skill or offer fewer opportunities for advancement. This is compounded by gender stereotypes and discrimination, both of which limit the income-earning potential for women in the gig economy. The report notes that women gig workers are less likely to get high-paying jobs than their male counterparts, especially in tech-driven roles like IT development or design. Instead, women are often confined to lower-paying sectors like home-based services and caregiving, where their work is undervalued.

In addition to gender disparities, age-based wage disparities also exist. Youth workers, although an integral part of the gig workforce, often face challenges in securing higher-paying, more stable work. Many young gig workers, especially those in the early stages of their careers, are limited to low-wage tasks, even if they possess relevant qualifications or skills.

3. Vulnerability To Exploitation: Inconsistent Payment And Job Insecurity

Because of the on-demand nature of gig work, workers are often subjected to inconsistent payment schedules, variable job opportunities, and uncertainty regarding workload. The report highlights that many gig workers are paid on a per-task basis, which leads to income fluctuations from week to week.

This lack of stable income can make it challenging for gig workers to meet their basic needs, such as paying for housing, healthcare, and education. Furthermore, many gig workers face challenges in getting paid on time. Some platforms have been criticised for delaying payments or providing inadequate payment structures, which create financial strain for gig workers. This payment instability can lead to discontent among workers, ultimately impacting their motivation and performance.

Moreover, job insecurity is a persistent issue. Gig workers do not have long-term employment contracts, leaving them with little recourse if they are dropped from a platform or face unfair treatment. This instability is often exacerbated by platform-based policies that allow companies to remove workers from the platform without clear justification or warning, further adding to the workers’ vulnerability.

4. Digital Literacy Barriers

Another significant challenge for gig workers, particularly for women and youth, is the issue of digital literacy. The report highlights that women in India are less likely than men to use the internet and less likely to own a mobile phone. This digital divide makes it harder for women to access gig work and limits their opportunities to engage in higher-paying digital gigs.

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New Sectors In The Gig Economy

The gig economy in India is no longer confined to a few traditional sectors such as ride-sharing or food delivery. Over the years, the demand for gig workers has significantly expanded into new industries, driving the evolution of platform-based work. These new sectors offer businesses and workers alike a broader spectrum of opportunities, and they will play a crucial role in the future growth of the gig economy.

Growth In Non-Traditional Sectors

Historically, gig work in India has been most visible in industries like transportation and food delivery. However, as more industries embrace digital platforms, we are witnessing an increasing spread of gig workers across non-traditional sectors. According to the report, gig roles are expanding into sectors such as:

  • Healthcare
  • Education
  • Professional Consulting
  • Creative Services
  • Marketing and Design

Healthcare

The healthcare gig economy is experiencing a surge in demand. In the wake of the COVID-19 pandemic, telemedicine and remote healthcare consultations became more popular, providing gig opportunities for doctors, nurses, and other medical professionals. 

For instance, telemedicine consultations, where doctors provide virtual consultations through platforms, have witnessed explosive growth. Similarly, the emergency services sector has also embraced gig work, with platforms offering on-demand healthcare services, including home nursing and physiotherapy.

Education

Education is another sector where gig workers are making a significant impact. The ed-tech sector in India has witnessed rapid growth in recent years, driven by digital learning platforms. The report states that gig workers in education include online tutors, content creators, and educational consultants.

These roles are expanding rapidly, particularly in subjects related to STEM (Science, Technology, Engineering, and Mathematics) education, as well as competitive exam preparation. With the rise of online learning, gig workers have the flexibility to work with multiple platforms, offering their expertise in a highly dynamic and flexible environment.

Professional Consulting

In the past, consulting was a career typically dominated by traditional firms. However, with the growth of gig platforms, there is now a growing demand for independent consultants across various industries. The report highlights that sectors such as management consulting, financial consulting, and legal services are increasingly relying on freelance consultants.

Many platforms have become hotbeds for highly skilled professionals to find short-term, project-based gigs that leverage their specialised knowledge. For instance, financial analysts can provide ad-hoc financial analysis, legal experts can offer contract review services, and business strategists can take on short-term strategic roles with clients across the globe.

Creative Services

The creative services sector is one of the most visible and fastest-growing in India’s gig economy. This includes professions like graphic design, content writing, video editing, and digital marketing. The demand for creative professionals is fueled by businesses seeking online content, advertising, and brand management.

According to the report, creative workers in digital marketing, copywriting, and graphic design are highly sought after on platforms. As brands shift to digital-first strategies, the need for creative talent in India is expected to grow significantly by 2030, representing a high-value sector for gig workers.

The Expanding Role Of Gig Work Across Sectors

The future of gig work in India is bright and diverse, with new sectors continuing to open up. As businesses seek flexible workforces that scale with demand, they increasingly turn to gig workers. The ability to onboard talent quickly, reduce overhead costs, and access a global talent pool has made gig work an attractive option for both companies and workers alike.

According to the report, the gig economy’s growth is set to expand beyond traditional sectors, creating opportunities in fields like agriculture, logistics, construction, and even government services. In these sectors, businesses will continue to adopt platform-based models, providing workers with flexibility and access to a wide variety of opportunities.

AuthBridge’s Solution For Gig Worker Verification

As gig work grows, businesses must ensure their gig workers are qualified, trustworthy, and compliant. AuthBridge’s Gig Worker Verification services provide an efficient, scalable solution for verifying large volumes of workers while minimising risks and ensuring fast onboarding.

Why Background Verification Is Essential

  1. Quick and Scalable Onboarding: AuthBridge automates the verification process, enabling businesses to verify gig workers quickly and at scale, significantly reducing turnaround time (TAT).

  2. Ensuring Compliance: Businesses must meet industry regulations. AuthBridge ensures gig workers are properly vetted for criminal records, identity, employment history, and professional certifications.

  3. Minimising Legal and Security Risks: Verifying workers ensures legal compliance and reduces the risk of hiring individuals with criminal backgrounds or unverified credentials, protecting your business from potential reputational damage.

Key Features of AuthBridge’s Verification Service

  • Identity Checks: Verifying gig workers’ identity with documents like Aadhaar, PAN, or Passport.

  • Criminal Record and Employment History: Ensuring workers meet legal requirements and confirming their professional background.

  • Licensing and Certification: Verifying required certifications (e.g., driver’s licenses, medical certifications) for job-specific roles.

  • Automated, Fast, and Reliable: Speed up the onboarding process with automated verification, reducing manual effort and improving efficiency.

Why Choose AuthBridge?

  1. Scalable and Efficient: AuthBridge’s automated platform allows businesses to verify large numbers of gig workers quickly and at scale.

  2. Industry-Specific Verification: Tailored solutions for healthcare, transportation, retail, and more.

Conclusion

India’s gig economy is poised for explosive growth, with gig workers expected to make up 14.89% of the non-agricultural workforce by 2047. The gig economy’s contribution to GDP is projected to rise from 1.25% in 2030 to 4% by 2047. This rapid expansion will be driven by digital platforms, sector diversification, and the increasing demand for flexible work.

However, businesses must address challenges such as informality, wage gaps, and the lack of worker protections to ensure a fair and sustainable gig economy. As the workforce diversifies, effective background verification will become crucial to maintaining compliance, ensuring worker safety, and building trust in the gig economy.

By Abhinandan, ago
What is CPV

What Is Contact Point Verification (CPV)? All You Need To Know

The process of Contact Point Verification (CPV) has become a key step in financial and lending processes, especially as digital transactions and remote onboarding become more common. CPV involves verifying the authenticity of phone numbers, email addresses, and physical addresses provided by borrowers or customers.

The importance of CPV lies in its ability to reduce fraud, enhance credit risk assessment, and ensure compliance with regulatory standards. Today, where identity theft and synthetic fraud are increasingly sophisticated, verifying contact points helps financial institutions maintain the integrity of their operations and build trust with clients.

This blog talks about the role of CPV in credit decision-making, fraud prevention, and regulatory adherence. It also explores why lenders and financial institutions must prioritise CPV in their due diligence frameworks.

What Is Contact Point Verification (CPV) And Why Is CPV Important?

Contact Point Verification (CPV) is the process of confirming that the contact details, primarily phone numbers, email addresses, and physical addresses, provided by an individual or entity are valid and accessible. While it may seem straightforward, CPV is key to due diligence in financial services and lending.

In practical terms, CPV involves cross-checking contact information through automated systems and manual verification methods such as one-time passwords (OTPs), calls, or emails. The goal is to ensure that the communication channels through which lenders or businesses engage with their clients are legitimate and operational.

The significance of CPV has grown in recent years due to the rise of digital lending platforms and remote onboarding, where physical verification is limited. Incorrect or falsified contact points can undermine credit assessments, lead to poor recovery rates, and increase exposure to fraud.

Beyond improving communication efficiency, CPV also strengthens compliance with regulatory frameworks that mandate thorough customer identification and verification. It serves as a frontline defence against synthetic identities and fraudulent loan applications, which often use fake or stolen contact information.

How CPV Helps Creditworthiness And Lending Decisions

In credit risk management, reliable data is the backbone of sound decision-making. Contact Point Verification (CPV) plays an important role in ensuring that the information lenders base their assessments on is accurate and trustworthy. When contact details such as phone numbers and email addresses are verified, lenders can establish a direct line of communication with borrowers, which is important throughout the loan lifecycle, from application to repayment.

Verified contact points help lenders assess the authenticity of the applicant and reduce the risk of fraud. For instance, an unverifiable phone number or email may signal a higher likelihood of synthetic identity fraud or loan stacking, both of which contribute to increased default risk. CPV also enables better monitoring of borrowers, facilitating timely reminders, restructuring discussions, or recovery efforts in case of defaults.

Moreover, financial institutions increasingly rely on digital footprints and communication patterns as part of alternative credit scoring models, especially for borrowers with limited credit history. Verified contact points provide reliable data inputs for such models, enhancing credit decision accuracy.

From a regulatory standpoint, CPV aligns with Know Your Customer (KYC) and Anti-Money Laundering (AML) requirements, reinforcing lenders’ compliance posture. Regulators expect institutions to maintain robust verification protocols to prevent fraud and financial crime, making CPV a mandatory element in many credit origination workflows.

Hence, Contact Point Verification strengthens credit risk frameworks by ensuring data integrity, enabling effective borrower engagement, and supporting regulatory compliance, ultimately leading to more informed lending decisions and healthier loan portfolios.

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How CPV Prevents Fraud And Compliance Risks

Fraud continues to pose a significant threat to financial institutions, with identity theft, synthetic identities, and phishing scams becoming increasingly sophisticated. Contact Point Verification (CPV) serves as a defence mechanism against these risks by ensuring that the communication channels linked to borrowers or customers are genuine and accessible.

Financial fraudsters often rely on falsified or temporary contact information to mask their identities and exploit vulnerabilities in onboarding processes. CPV disrupts such attempts by validating phone numbers and email addresses through methods such as OTP authentication, live call verifications, and cross-referencing with trusted databases. 

In addition, CPV enhances compliance with regulatory mandates. The Reserve Bank of India (RBI), among other regulators globally, has emphasised the need for rigorous KYC and AML checks to mitigate financial crimes. Verifying contact points is an integral component of these checks, helping institutions meet regulatory standards and avoid penalties.

Beyond fraud and compliance, CPV also improves operational efficiency by reducing failed communications and bounce rates in recovery and servicing processes. This has a direct impact on the cost and effectiveness of collections and customer service teams.

Contact Point Verification: Real-Life Use Cases

Contact Point Verification (CPV) plays a decisive role across various financial and lending scenarios, often acting as a key difference in making a sound credit decision and a costly error.

Digital Lending Platforms

Digital lending platforms have surged in India over the last few years. These platforms rely heavily on remote onboarding, where physical verification of documents and identities is limited or absent. CPV becomes essential to validate that the applicant’s phone number and email address are genuine and accessible. A verified contact point allows lenders to maintain communication throughout the loan lifecycle, from disbursal to repayment, and to respond quickly to potential red flags such as delayed payments or defaults.

Retail Banking Sector

In the retail banking sector, CPV supports fraud prevention by detecting inconsistencies early. For instance, if a borrower’s contact details cannot be verified or are linked to multiple accounts suspiciously, it raises immediate concerns about identity theft or synthetic identities. Banks use CPV as part of their layered verification process to flag such anomalies and initiate deeper investigations.

SME Credit Underwriting Services

CPV is equally critical in credit underwriting for small and medium enterprises (SMEs), where traditional credit history may be scarce or unavailable. Validated contact points enable lenders to reach out for additional documentation or clarification efficiently, reducing the turnaround time for loan approvals and improving the accuracy of credit assessments.

Collection And Recovery Operations

Furthermore, CPV is used extensively in collections and recovery operations. Confirmed contact information ensures that reminder calls, emails, and notices reach the borrower promptly, increasing the likelihood of repayment. In cases of default, verified contact points are crucial for successful recovery efforts, minimising non-performing assets (NPAs).

The Economic Impact Of Contact Point Verification On Businesses And Consumers

CPV holds significant economic implications for both financial institutions and their customers. At its core, CPV enhances the efficiency and reliability of credit markets by reducing information asymmetry.

  1. For businesses, especially lenders and fintech companies, accurate contact information translates into lower default rates and reduced operational costs. By verifying phone numbers and email addresses upfront, institutions can filter out high-risk applicants engaging in fraudulent activities or identity misrepresentation. This directly lowers the incidence of non-performing assets (NPAs), which can severely impact profitability and capital adequacy ratios.
  2. Moreover, verified contact points facilitate smoother communication throughout the credit lifecycle. This leads to improved customer engagement, timely repayments, and more effective recovery processes. Consequently, institutions benefit from higher portfolio quality and greater operational efficiency.
  3. From a broader economic perspective, CPV contributes to financial inclusion by enabling lenders to extend credit with greater confidence to underserved segments. Particularly in India, where many borrowers have limited credit history, reliable contact verification supports alternative credit assessment models that use communication data as proxies for creditworthiness. This can accelerate credit availability to MSMEs, first-time borrowers, and gig economy workers, fostering economic growth.
  4. Consumers, too, gain from CPV as it helps protect them against fraud, identity theft, and predatory lending practices. It enhances trust in financial service providers and improves the overall customer experience by ensuring transparent and secure communication.

In summary, robust CPV not only strengthens individual institutions’ risk profiles but also bolsters the health and inclusiveness of the financial ecosystem, contributing to sustainable economic development.

What’s Next For Contact Point Verification

As digital transformation accelerates across financial services, Contact Point Verification (CPV) is evolving beyond traditional checks to incorporate advanced technologies and data analytics. The future of CPV lies in leveraging artificial intelligence (AI), machine learning, and real-time data integration to deliver faster, more accurate, and scalable verification solutions.

AI-powered systems can analyse vast datasets to detect anomalies and predict the authenticity of contact points with greater precision. For example, machine learning models assess communication patterns, device fingerprints, and historical data to flag suspicious phone numbers or email addresses automatically. This proactive approach helps pre-empt fraud attempts before they escalate.

Integration with broader identity verification frameworks, such as biometrics and digital KYC platforms, is becoming increasingly common. CPV will no longer operate in isolation but as a critical component within multi-layered authentication systems, enhancing overall security and compliance.

Moreover, the expansion of mobile and internet penetration in emerging markets is driving innovation in verification methods. Instantaneous OTP-based validations, geo-location tagging, and social media data corroboration are gaining traction to ensure contact information reflects real, accessible individuals.

In conclusion, Institutions that invest in next-generation CPV technologies stand to benefit from reduced fraud risk, improved customer trust, and a competitive edge in an increasingly digital marketplace.

Conclusion

Contact Point Verification stands as a vital safeguard that goes far beyond simple data checks. By ensuring the authenticity and accessibility of contact details, CPV strengthens credit assessments, mitigates fraud risks, and upholds regulatory compliance. For lenders and financial institutions aiming to build resilient portfolios and foster trust, integrating robust CPV processes is no longer optional—it is essential. As technology advances, embracing innovative verification methods will be key to staying ahead in a rapidly evolving market and securing the foundation of trustworthy financial relationships.

By Abhinandan, ago
Quick Commerce Fraud Blog

How Warehouse Ops Verification Ensures Quick Commerce Compliance

On June 1, 2025, the Maharashtra Food and Drug Administration (FDA) took a major step in suspending the food business license of a well-known quick-commerce platform operating in Mumbai. This action followed a comprehensive inspection of its Dharavi warehouse, where inspectors discovered a series of serious violations. Among the most concerning findings were fungal contamination on consumable products, expired items stored next to fresh stock, and poorly maintained cold storage conditions, each of which posed a direct threat to consumer safety.

These lapses showcase a significant breach of consumer trust. In the customer-driven and super-fast sector of quick-commerce, the repercussions of such negligence can be severe. The suspension of the license is just one of the immediate repercussions, but the long-term damage to the platform’s brand reputation is also concerning. This scandal is a pressing reminder of why businesses must prioritise compliance and consumer safety, not only as a legal obligation but as a basis of their operational integrity.

Unfortunately, incidents like these are not isolated. As the e-commerce and quick-commerce sectors continue to grow, the challenge of maintaining rigorous standards becomes more complex. While regulatory bodies play a key role in enforcing these standards, the responsibility for safeguarding against such fraud lies equally with the businesses themselves. The failure to conduct thorough due diligence, implement effective verification processes, and maintain high operational standards can quickly lead to catastrophic outcomes for both businesses and consumers.

The Impact Of Quick-Commerce Scandals On Brand Reputation And Consumer Trust

The Maharashtra FDA’s decision to revoke the quick-commerce platform’s license after discovering fungal growth on food items and expired products in unhygienic storage conditions highlights a key weakness in the industry. A breach of consumer trust, especially in a sector where convenience and safety are non-negotiable, can lead to lasting reputational damage that no amount of marketing or customer service recovery can easily fix. Once consumer confidence is lost, the path to regaining that trust is laden with challenges.

The impact of this incident goes beyond the company in question. E-commerce platforms, particularly those dealing with perishable FMCG, must acknowledge the fact that their operational standards are under constant scrutiny, and any failure to adhere to stringent safety protocols can result in a loss of market share, legal consequences, and a sharp decline in consumer loyalty.

How Thorough Warehouse Operations Verification Can Prevent Fraud

The risks of not implementing a comprehensive verification process are quite detrimental, as the recent scandal in Mumbai has shown. Fortunately, e-commerce platforms can take proactive steps to minimise these risks by incorporating thorough and multi-layered verification practices that address all areas of concern.

Key Areas of Verification

  • Compliance with Regulatory Standards: Ensure that all sellers and warehouses of Food Business Operators (FBO) are legally registered and have the necessary licences to operate. This includes validating:
    • GSTIN (Goods and Services Tax Identification Number)
    • CIN (Corporate Identification Number)
    • FSSAI (Food Safety and Standards Authority of India) certification for food-business operators
    • Valid business address verification
  • Financial Health: Evaluate the FBO financial stability by:
  • Background Checks: Assess the FBO’s employees’ history to uncover any potential risks by conducting:
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Ongoing Monitoring

Verification doesn’t end with the initial check. Continuous monitoring is crucial for maintaining a secure marketplace. Regularly track and evaluate warehouse operators to ensure that they uphold safety and compliance standards. Some tools to aid ongoing monitoring include:

  • Automated Alerts based on sales patterns and customer reviews

  • Returns and Disputes Analysis to identify potential red flags

  • Regular Audits to check for adherence to health and safety standards

By employing these comprehensive measures, e-commerce platforms can ensure that fraudulent or non-compliant sellers are filtered out before they can cause harm. Preventing fraud and ensuring operational integrity goes beyond initial verification; it requires ongoing diligence.

AuthBridge’s Comprehensive Verification Solutions For E-Commerce

At AuthBridge, we understand the complexities of running a secure, compliant, and consumer-friendly marketplace. Our suite of verification solutions is designed to provide e-commerce platforms with the tools they need to perform comprehensive checks on their sellers and ensure that only legitimate, trustworthy businesses make it onto their platform.

Key Verification Services for E-Commerce:

  • KYC (Know Your Customer) Solutions: Our KYC solutions are designed to quickly and efficiently verify the identity of sellers. We offer digital identity verification using government-issued IDs, ensuring that all sellers are who they claim to be.
  • GST and PAN Verification: AuthBridge’s tools help verify GSTIN and PAN details to ensure that sellers are registered with the correct tax authorities and compliant with India’s tax regulations.
  • Business Information Verification: We provide detailed reports on a business’s legal status, financial health, and operational history. This includes verification of:
    • CIN (Corporate Identification Number)
    • Company Registration
    • FSSAI Certification (for FBO warehouse operators)
  • Criminal Background Screening: We conduct comprehensive background checks on FBOs and their key personnel to ensure they have no criminal records or legal issues that could jeopardise the safety and trust of the platform.
  • Address and Location Verification: Our solutions also include verifying the physical addresses of FBOs, ensuring that products are sourced from reliable, compliant, and traceable locations.

Technology-Driven Verification

At AuthBridge, we leverage advanced technologies like AI, machine learning, and facial recognition to streamline the verification process and enhance accuracy:

  • AI-Powered Document Verification: Our automated solutions use AI to validate documents, ensuring that they are authentic and meet regulatory standards.
  • Facial Recognition and Liveness Detection: To enhance security, we offer facial recognition technology that matches users with their official identification documents. This also includes liveness detection to prevent spoofing attempts during remote verifications.
  • Automated Risk Scoring: Our platform uses machine learning algorithms to assign a risk score to sellers based on their compliance and past performance, helping e-commerce platforms make informed decisions quickly.

Continuous Monitoring and Compliance

Verification doesn’t stop after the onboarding process. E-commerce platforms must continuously monitor their sellers to ensure they maintain compliance with safety, quality, and regulatory standards. AuthBridge provides ongoing monitoring solutions that help businesses track seller activities and flag any unusual patterns or violations. This proactive approach reduces the risk of fraud and ensures that platforms remain compliant with ever-changing regulations.

Conclusion

The recent incident in Mumbai highlights the pressing need for e-commerce platforms to prioritise comprehensive warehouse operations verification. With the increasing risks of fraud and regulatory scrutiny, platforms must adopt rigorous verification processes to safeguard their reputation, ensure consumer trust, and remain compliant. At AuthBridge, our advanced verification solutions provide businesses with the tools needed to prevent fraud, protect customers, and build a secure, trustworthy marketplace.

By Abhinandan, ago
Driver Onboarding End to End

Why Getting Driver Onboarding Right Is Essential For Your Business

India’s ride-hailing, last-mile delivery, and quick commerce sectors are growing rapidly. The drivers and delivery partners are at the heart of this growth, the faces your customers interact with daily. But rapid expansion comes with a tough challenge: onboarding these partners quickly without compromising safety, compliance, or authenticity.

However, some pressing issues are even more concerning. According to government data, nearly 30% of driving licences in India are fake or fraudulent. This alarming figure highlights a widespread problem that directly impacts the safety and reliability of these platforms and sectors.

To operate legally and safely, platforms must verify key documents such as:

Indian DL Frauds

Failing to verify these documents thoroughly risks platforms to regulatory fines under the Motor Vehicles Act, potential lawsuits, and damage to brand reputation.

Beyond legal risks, poor onboarding opens the door to fraud, safety hazards, and operational inefficiencies. Fake or forged licences, cloned vehicle papers, and GPS spoofing schemes have become common, costing platforms millions annually in losses and customer trust.

An inefficient onboarding process also delays driver activation, causing unmet demand and increased cancellations, directly hitting revenue and customer experience.

Given these challenges, a fast, rigorous, and technology-driven onboarding solution that verifies both driver credentials and vehicle documents in real time is essential. Such systems reduce fraud, ensure regulatory compliance, and enable platforms to scale confidently in India’s highly competitive market.

Why Verifying Drivers/Riders Is Essential?

A significant portion of drivers and delivery agents are third-party or gig workers, often operating through aggregators or multiple platforms. This decentralised model poses unique challenges for verification:

1. Complexity of Multi-Platform and Gig Worker Verification

Third-party drivers frequently work across multiple platforms or switch jobs rapidly, making it hard to maintain accurate, up-to-date verification records. Without a centralised verification system, platforms risk onboarding individuals with questionable employment histories or fraudulent documents repeatedly.

2. Higher Fraud Risk with Third-Party Workers

Because third-party workers may have less direct accountability, the incidence of forged documents, fake identities, or misuse of credentials is higher. Fraudulent drivers can exploit gaps in verification, causing financial loss and safety risks.

3. Regulatory Compliance Complexity

Platforms are responsible for ensuring compliance even when onboarding third-party drivers. This requires more stringent verification processes and frequent re-validation to meet evolving legal standards under the Motor Vehicles Act and gig worker protections.

4. Operational Efficiency and Customer Trust

Proper third-party onboarding reduces operational friction caused by driver churn and cancellations. It also enhances rider and customer confidence, knowing that all drivers, regardless of employment status, meet rigorous verification standards.

The Brand And Customer Loyalty Cost Of Poor Driver Verification

Weak driver onboarding and verification have direct, measurable consequences on a business’s viability, compliance, and growth.

1. Substantial Financial Leakage from Fraud

Nearly 30% of driving licences in India are fraudulent. This translates into millions lost through fake trips, inflated deliveries, and false claims, impacting profitability by an estimated 10-15% annually for many platforms. Fraudulent drivers increase chargebacks, penalties from payment processors, and operational overhead in dispute resolution.

2. Regulatory Risks That Can Halt Operations

Failure to verify drivers and vehicles in line with the Motor Vehicles Act and local transport regulations risks heavy fines, legal sanctions, and license suspensions. Regulatory crackdowns are increasing, with several Indian states conducting audits and blacklisting non-compliant platforms. This creates operational uncertainty, disrupts market presence, and increases compliance costs.

3. Erosion of Customer Trust and Brand Equity

Safety incidents linked to unverified drivers or unfit vehicles lead to negative media coverage and social media backlash, a reputation risk that’s hard to recover from. In highly competitive markets like ride-hailing platforms and logistics, customers/businesses quickly switch to competitors promising safer, verified services. Retaining and growing customer bases requires demonstrable, transparent verification standards.

4. Operational Inefficiencies and Capacity Constraints

Slow, manual, or error-prone onboarding delays driver activation, leading to service gaps and unmet demand during peak periods. This results in higher cancellation rates, longer wait times, and diminished customer satisfaction. Platforms incur extra costs managing onboarding backlogs and rework on verification errors.

Alongside verifying identity and vehicle documents, discrepancies in education and employment backgrounds among drivers and delivery partners add another layer of risk. Data from our annual trend report shows education-related discrepancies at 3.7%, with forged certificates increasingly common, while employment verification reveals about 1.7% discrepancies due to falsified records or workers juggling multiple platforms.

What Makes An Effective Driver Onboarding Solution?

The difference between a good and a great driver onboarding solution boils down to three things: accuracy, speed, and trust. Today, companies need onboarding systems that don’t just verify documents, but do it quickly and flawlessly, so they can grow without risking compliance or reputation.

A top onboarding solution combines deep local knowledge with cutting-edge technology to ensure every driver and vehicle is thoroughly vetted, onboarding times are minimal, and fraud is caught before it impacts business.

1. Comprehensive Verification of All Critical Documents

Verifying the authenticity and validity of essential documents like the Driving Licence, Vehicle RC, Insurance, PUC, and Fitness Certificate can’t be ignored. The system must cross-check these against government and proprietary databases to detect forged, expired, or manipulated documents immediately.

2. Rapid Turnaround Times (TAT) Without Sacrificing Quality

Effective solutions deliver verifications within hours, enabling platforms to activate drivers quickly and meet customer needs without delay, all while maintaining high verification standards.

3. AI-Driven Fraud Detection Tailored to Indian Market Realities

Fraud tactics evolve constantly. Solutions must deploy AI algorithms trained on local data to identify fake identities, duplicate profiles, GPS spoofing, and subtle document manipulations that human checks might miss.

4. Real-Time Integration with Authoritative Data Sources

Connecting directly with government databases and trusted third-party sources allows instant validation of documents and data, reducing manual errors and ensuring full regulatory compliance.

5. Expert Human Oversight for Complex Cases

Automation can’t catch everything. Skilled verification professionals handle discrepancies, flagged cases, and edge situations, guaranteeing decisions are accurate, compliant, and fair.

6. Full Compliance and Audit Readiness

The onboarding process should generate detailed audit trails and compliance reports tailored for Indian regulations, simplifying internal reviews and facilitating smooth government audits.

7. Scalable and Flexible Infrastructure Supporting Diverse Regional Needs

India’s varied documentation standards and languages require a system that scales seamlessly across regions and volumes without compromising quality or turnaround time.

AuthBridge’s Indigenous, Scalable & End-to-End Driver Onboarding Solution

AuthBridge’s driver onboarding solution leverages its proprietary Vault database, one of the largest in India, combined with real-time government integrations and AI-powered analytics.

Driver Onboarding Info 2

This combination ensures unparalleled accuracy and compliance tailored for ride-hailing, logistics, and supply chain platforms.

1. Driving Licence Verification Via Government Database

Validates licences against the mParivahan/Sarathi database, detecting forged, expired, or fake licences. This ensures drivers are legally authorised to operate specific vehicle categories, complying with the Motor Vehicles Act.

2. Vehicle Registration Certificate (RC) Verification via Vahan Database

Cross-verifies vehicle details from the Vahan database and Vault, confirming ownership, registration status, vehicle class, and fitness. This prevents the onboarding of cloned or fake vehicles or ones with hefty unpaid challans or impounded.

3. Stolen Vehicle and Criminal Record Checks Through Vault and NCRB Data

Checks vehicles against National Crime Records Bureau (NCRB) listings and other proprietary databases for stolen or blacklisted vehicles. This mitigates the risk of unknowingly onboarding illegal or criminally flagged vehicles.

4. Compliance with Motor Vehicles Act and Related Regulations

Enforces mandatory document validations, including Insurance Certificates, Pollution Under Control (PUC), and Fitness Certificates, ensuring compliance with central and state laws.

5. AI-Driven Fraud Detection and Multi-Level Quality Checks

Uses proprietary AI algorithms tailored to Indian fraud patterns to detect synthetic identities, document tampering, duplicate accounts, and GPS spoofing. Multi-level quality checks reduce false positives and improve accuracy.

6. Dedicated 24×7 Operations Team and Surge Absorption at Zero Additional Cost

Provides round-the-clock operations with dedicated resources trained on client-specific SOPs, ensuring a P90 TAT under 3 hours (in specific cases) even during volume surges. Absorbs unexpected spikes or dips in onboarding volumes without extra cost, ensuring smooth scalability.

How AuthBridge Helped A Leading Ride-Hailing Platform

  • Delivered over 1 crore verifications for a leading ride-hailing platform with 90+ lakh cases closed within the agreed TAT.
  • Maintained 99.99% data coverage with multiple layers of quality control.
  • Achieved 14% case conversion from discrepant to clear, significantly reducing false positives and operational overhead.
Driver Onboarding Info 1

AuthBridge provides a scalable, integrated verification platform capable of handling the complexity of third-party onboarding. By leveraging AI, deep data integrations, and a strong operational team, AuthBridge ensures that third-party workers are vetted with the same rigour and speed as white-collar workers.

Conclusion

In a market where fraud, compliance, and operational speed define success, AuthBridge turns driver onboarding from a complex challenge into your platform’s strongest asset, delivering unmatched accuracy, lightning-fast verifications, and scalable support to keep your business safe, trusted, and ready to grow across India.

By Abhinandan, ago
e-passport

Indian ePassport: Features, Eligibility & How To Apply

The road to India’s ePassport began with a pilot project launched on April 1, 2024, as part of the upgraded Passport Seva Programme Version (PSP) 2.0. Building on this pilot, the ePassport rollout program is now official nationwide, with the government gradually enabling all Passport Seva Kendras (PSKs) and Regional Passport Offices (RPOs) nationwide to issue these secure passports. Citizens applying for a fresh passport or re-issuance at any enabled centre will receive an ePassport by default.

Currently, thirteen Regional Passport Offices, including Nagpur, Bhubaneswar, Jammu, Goa, Shimla, Raipur, Amritsar, Jaipur, Chennai, Hyderabad, Surat, Ranchi, and Delhi, have started issuing chip-enabled ePassports to citizens.

Importantly, all passports issued before the rollout remain valid until their expiry date. Passport holders are not immediately required to replace their existing passports with the electronic version. This phase-wise approach ensures a smooth transition, allowing time for infrastructure and technology upgrades while maintaining accessibility for travellers. 

What Is An ePassport In India? Features And Security Explained

An ePassport is a travel document that combines the traditional passport booklet with an embedded electronic chip. This chip securely stores the holder’s personal particulars and biometric data, including fingerprints and facial recognition templates, using Radio Frequency Identification (RFID) technology.

Visually, the presence of the chip is indicated by a gold-coloured symbol printed on the passport’s front cover. The chip contains encrypted data, digitally signed through Public Key Infrastructure (PKI), which enables immigration authorities worldwide to authenticate the passport securely.

This greatly reduces the risk of forgery, duplication, and tampering. Moreover, the ePassport complies with the International Civil Aviation Organisation (ICAO) standards, ensuring interoperability with border control systems globally. Through this technology, Indian citizens benefit from enhanced security, faster clearance at immigration checkpoints, and a more seamless travel experience.

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Benefits Of ePassport

  • Stronger Security Against Forgery: The embedded RFID chip stores encrypted personal and biometric data, making it extremely difficult to forge or tamper with passports.
  • Biometric Authentication: Includes fingerprints and facial recognition data, allowing reliable and quick identity verification at immigration checkpoints.
  • Faster Immigration Clearance: Automated verification systems read the chip data swiftly, reducing wait times and easing the travel process.
  • Global Interoperability: Complies with International Civil Aviation Organisation (ICAO) standards, ensuring acceptance and seamless verification at border controls worldwide.
  • Improved Data Integrity: Public Key Infrastructure (PKI) technology digitally signs the data on the chip, guaranteeing authenticity and preventing data manipulation.
  • Enhanced Monitoring by Authorities: Helps government agencies track passenger movements accurately for security and regulatory purposes.
  • Prevention of Fraudulent Activities: The chip’s security features reduce the risks of identity theft, passport duplication, and illegal border crossings.
  • Convenient for Travellers: The ePassport symbol on the cover provides quick identification by immigration officials, making international travel smoother.

Who Is Eligible For The ePassport?

The rollout of the ePassport in India applies broadly to all citizens applying for a fresh passport or re-issuance at Passport Seva Kendras and Regional Passport Offices that are technically enabled for issuing ePassports. There is no separate eligibility restriction based on age, profession, or other categories.

Key points on eligibility include:

  • All Indian Citizens: Any citizen applying for a new passport or re-issue at enabled centres will receive an ePassport by default.
  • Existing Passport Holders: Current passports remain valid until their expiry. There is no mandatory requirement to replace an existing valid passport with an ePassport immediately.
  • Diplomatic and Official Passports: The ePassport programme also covers diplomatic and official passport holders, continuing the pilot scheme initiated in 2008 for government officials.
  • Children and Minors: Minors are eligible for ePassports as per standard application procedures, with additional documentation requirements as applicable.
  • Phased Availability: Since the rollout is gradual, citizens must check whether their regional passport office has been enabled to issue ePassports. Only offices with technical readiness issues issue the chip-enabled passports.

How To Apply For An ePassport In India: Step-by-Step Guide

Applying for an ePassport in India is a streamlined process facilitated through the Passport Seva Online Portal, ensuring convenience and transparency for applicants nationwide. Below is a detailed walkthrough of the application steps:

Step 1: Register on the Passport Seva Online Portal

Visit the official Passport Seva website and create a user account by clicking on the “Register Now” link. Fill in the required details carefully to complete your registration.

Step 2: Log In and Select Application Type

Log in using your registered credentials. Click on “Apply for Fresh Passport/Re-issue of Passport.”

  • If you have never held a passport of the same category (ordinary, diplomatic, official), apply under the “Fresh Passport” category.
  • If you are renewing or re-issuing the same category of passport, select “Re-issue.”

Step 3: Fill In the Application Form

Complete the online application form with accurate personal, address, and identification details. Review carefully before submission.

Step 4: Pay Fees and Schedule An Appointment

Pay the applicable passport fees online via debit/credit card or net banking. After payment, schedule an appointment at the Passport Seva Kendra (PSK) or Regional Passport Office (RPO) of your choice.

Step 5: Print or Save Application Receipt

Print or save the application receipt containing your Application Reference Number (ARN) or Appointment Number. This receipt confirms your appointment booking.

Step 6: Visit Passport Seva Kendra (PSK) or Regional Passport Office (RPO)

Attend your scheduled appointment with original documents and photocopies. The list of required documents varies depending on the application type (fresh or re-issue).

Step 7: Biometric Data Collection and Verification

At the PSK/RPO, your biometric data (fingerprints, photograph) will be collected. Your documents and information will be verified.

Step 8: Track Application Status

You can track your application status online using your ARN through the Passport Seva portal.

Step 9: Receive Your ePassport

Once processed and approved, your ePassport will be dispatched to your registered address via secure courier.

Important Notes:

  • Carry your appointment SMS or printed receipt for verification during your PSK visit; carrying a printout is optional but recommended.
  • In case of minors (below 4 years), carry a recent passport-size photograph with a white background.
  • Applications must be completed and appointments attended within 90 days, else resubmission is necessary.
  • Emergency and medical cases may get exceptions for appointments at PSKs.

Documents Required For ePassport Application

To apply for an ePassport in India, you must submit valid documents as proof of identity, address, and date of birth. The exact documents required depend on the category of application (fresh or re-issue) and individual circumstances. Generally, the following are accepted:

  • Proof of Identity:
    Aadhaar card, Voter ID, PAN card, Driving Licence, Government-issued ID cards, or any other government-recognised document with photo and signature.
  • Proof of Address:
    Utility bills (electricity, water, gas), Passport of spouse, Bank statements/passbook, Ration card, Rent agreement, or any other official document confirming residence.
  • Proof of Date of Birth:
    Birth certificate issued by a municipal authority or district office, school leaving certificate, matriculation certificate, or any authorised document confirming DoB.
  • Additional Documents (if applicable):
    • For minors: Birth certificate and parents’ passports or ID proofs.
    • For married applicants: Marriage certificate or spouse’s passport may be required.
    • For government officials or diplomats: Official identity cards and government orders.

Applicants must carry original documents and photocopies during their appointment at the Passport Seva Kendra or Regional Passport Office.

Important Note on Appointment Exceptions

While booking an appointment online through the Passport Seva Portal is mandatory for most applicants, certain exceptions apply. Emergency cases, such as medical emergencies or other urgent situations, may be allowed to visit Passport Seva Kendras (PSKs) or Regional Passport Offices (RPOs) without a prior appointment. However, this service is provided strictly at the discretion of the PSK in charge or the Passport Officer.

Applicants seeking to avail of this exception must provide valid supporting documents or proof of urgency. It is advisable to contact the respective Passport Office beforehand to confirm eligibility for walk-in services under exceptional circumstances.

By Abhinandan, ago
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How Are AI & ML Redefining AML Practices

Do you know: Money laundering is one of the biggest threats to the integrity of global financial systems?. Despite decades of investment in Anti-Money Laundering (AML) compliance programmes, financial institutions face persistent challenges in detecting, investigating, and reporting illicit activity with the required precision and timeliness. Traditional rules-based transaction monitoring systems (TMS), while foundational, are increasingly exposed for their inefficiency, resulting in alarmingly high false positive rates, often exceeding 95% according to industry studies, and burdening compliance teams with extensive manual reviews.

The emergence of Artificial Intelligence (AI) within the AML domain is not merely a technological upgrade — it is a necessary recalibration of the industry’s approach to financial crime risk management. Regulatory bodies such as the Financial Action Task Force (FATF) and national supervisors have acknowledged the potential for AI and machine learning to enhance effectiveness in identifying suspicious patterns, improving Customer Due Diligence (CDD), and strengthening Suspicious Activity Report (SAR) processes.

Importantly, AI in AML is being deployed with strict adherence to principles such as explainability, model risk management, and data privacy compliance — essential requirements in regulated environments. Far from replacing human expertise, AI is augmenting it: enabling faster, more accurate detection of anomalous behaviour, optimising the allocation of investigative resources, and facilitating a risk-based approach to compliance.

How AI Is Revolutionising Anti-Money Laundering

Financial institutions historically relied on static, rules-based systems for detecting potential money laundering activities. These systems, although robust when first deployed, were designed around pre-defined typologies — setting thresholds for transaction sizes, monitoring high-risk geographies, and flagging activities that fit established patterns of concern. While they provided a necessary compliance foundation, their inherent rigidity limited their ability to adapt to changing laundering methodologies, increasingly sophisticated criminal networks, and the varying nature of cross-border financial flows.

Artificial Intelligence (AI) is fundamentally altering these dynamics by introducing the ability to identify non-linear, previously unseen behavioural patterns across vast datasets in near real-time. Instead of rigidly applying a fixed set of rules, AI-powered systems utilise machine learning algorithms trained on historical transactional data, customer profiles, sanctions lists, and open-source intelligence to dynamically refine detection models. These models continuously learn from new data, enhancing their predictive capabilities and their ability to distinguish between genuine anomalies and benign customer behaviour.

In transaction monitoring, AI is enabling systems to assess the context around transactions rather than viewing them in isolation. For instance, the same transaction value might appear normal for one customer but suspicious for another, depending on their historical activity, peer group behaviour, and geographic profile. AI-driven systems evaluate this peculiarity, applying dynamic risk-scoring models that prioritise cases for investigation based on a far more granular assessment of risk.

Moreover, AI is reshaping Customer Due Diligence and Know Your Customer (KYC) processes. Traditional CDD often relies on periodic reviews, creating risks of stale information. AI allows for continuous monitoring and real-time updates to customer risk profiles by integrating data from transactional behaviour, adverse media screening, and changes in beneficial ownership structures. This capability is vital, especially under enhanced due diligence (EDD) requirements for high-risk customers.

Major AI Tech Powering Modern AML Systems

The application of Artificial Intelligence in Anti-Money Laundering is powered by a suite of advanced technologies, each contributing unique capabilities to enhance detection, investigation, and reporting processes. A nuanced understanding of these technologies is essential for appreciating how AI is moving AML compliance beyond traditional thresholds.

Machine Learning (ML)

At the heart of modern AML systems lies machine learning — the capability of algorithms to identify patterns and infer risk without being explicitly programmed for each scenario. Supervised learning models, trained on labelled datasets of known suspicious and non-suspicious activity, can classify new activities with increasing accuracy. Meanwhile, unsupervised learning models excel at anomaly detection, identifying patterns that deviate from established norms, which may indicate emerging forms of laundering that traditional typologies miss.

Natural Language Processing (NLP)

AML professionals must often sift through vast amounts of unstructured data — adverse media reports, legal filings, regulatory blacklists, and client communications. Natural Language Processing (NLP) allows AI systems to extract relevant information, detect hidden relationships, and highlight potential red flags from such text-heavy sources.

NLP models have become critical tools in screening for Politically Exposed Persons (PEPs), sanctions violations, and adverse media mentions. They assist in building dynamic risk profiles that evolve beyond static customer information captured during onboarding.

Behavioural Analytics

One of the significant advances brought by AI to AML is the shift towards behavioural analysis. Instead of assessing individual transactions in isolation, AI models evaluate holistic customer behaviour patterns over time. Changes in transaction size, frequency, counterparties, geographic location, and payment methods are analysed collectively to assess whether an activity aligns with expected behaviour profiles.

For instance, a retail customer consistently transacting within a domestic footprint suddenly initiating multiple high-value international wire transfers could trigger a dynamic risk reassessment — a sophistication that conventional static rules often fail to capture.

Knowledge Graphs

Knowledge graphs are emerging as powerful enablers in the fight against financial crime. By visually mapping relationships between entities — individuals, companies, addresses, and accounts — knowledge graphs allow investigators to uncover hidden networks and potential money laundering schemes such as layering and integration.

Graph analytics combined with AI allows for efficient identification of indirect links between clients and known illicit actors, significantly improving the quality of Suspicious Activity Reports (SARs) and the institution’s broader financial crime risk management posture.

Robotic Process Automation (RPA) Combined With AI

While not AI in itself, Robotic Process Automation (RPA) is increasingly being combined with AI to automate repetitive AML compliance tasks, such as data extraction, case creation, and document verification. AI-enhanced RPA (sometimes referred to as Intelligent Automation) ensures that routine compliance workflows are executed with speed, accuracy, and auditability, freeing human analysts to focus on higher-risk investigations.

Real-World Use Cases Of AI In AML

Artificial Intelligence is no longer confined to experimental projects within financial institutions. Today, leading banks, fintechs, and regulatory authorities are actively deploying AI-driven solutions to enhance Anti-Money Laundering (AML) outcomes. These applications are not speculative; they are grounded in measurable impact, backed by internal audits, regulatory assessments, and global industry studies.

Dynamic Transaction Monitoring

One of the most prominent use cases is in transaction monitoring. Traditional rule-based systems triggered alerts based on static thresholds, often resulting in excessive false positives. AI-driven transaction monitoring models apply dynamic baselines, adjusting alerting thresholds according to evolving customer behaviour patterns.

For example, a leading global bank integrated machine learning models into its transaction monitoring system across key markets. According to public disclosures, this initiative led to a significant reduction in false positives while simultaneously improving the identification rate of genuinely suspicious transactions. These gains not only enhanced compliance effectiveness but also reduced the strain on investigative teams.

Customer Risk Scoring And Continuous CDD

Continuous Customer Due Diligence is critical in maintaining up-to-date risk profiles, yet periodic manual reviews often lag behind reality. AI models enable financial institutions to automatically reassess risk profiles based on real-time inputs like transactional behaviour, updated adverse media hits, or geopolitical developments.

Screening customers against sanctions lists, PEPs (Politically Exposed Persons), and adverse media has traditionally been a compliance bottleneck, requiring substantial manual effort to resolve false matches.

Fraud And AML Convergence

There is increasing recognition that fraud and money laundering are often interlinked. AI solutions are facilitating convergence between fraud detection and AML transaction monitoring.

A leading global banking major has publicly discussed how it combined its fraud analytics and AML transaction monitoring using AI, improving detection of mule accounts (used to launder fraud proceeds) and enhancing overall suspicious activity identification. This convergence allows financial institutions to spot early indicators of laundering from fraud typologies, such as account takeovers and synthetic identities.

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Benefits Of Using AI In AML Compliance

The integration of Artificial Intelligence into Anti-Money Laundering (AML) frameworks is delivering tangible, measurable benefits that go beyond incremental process improvements. Institutions that have moved beyond pilot programmes to operationalise AI are witnessing enhancements not just in detection capabilities, but also in compliance sustainability, resource allocation, and regulatory engagement.

Reduction In False Positives And Operational Efficiency Gains

One of the most significant challenges in traditional AML systems has been the high volume of false positive alerts. Industry studies estimate that up to 96% of alerts generated by legacy transaction monitoring systems are ultimately found to be non-suspicious. This inefficiency burdens compliance operations, increases investigative backlogs, and dilutes the focus on genuinely suspicious cases.

AI-based monitoring solutions address this issue by contextualising transactional behaviour, resulting in sharper alert generation. Institutions deploying AI models have reported reductions in false positives ranging from 20% to 50%, depending on model maturity and integration depth. As a result, investigative teams are able to concentrate their efforts on genuinely high-risk cases, improving investigative throughput and decision quality.

Improved Quality And Timeliness Of Regulatory Reporting

Financial Intelligence Units (FIUs) across jurisdictions have raised concerns regarding the quality of Suspicious Activity Reports (SARs), often citing incomplete narratives, inadequate link analysis, and missed typologies. AI-enhanced case management platforms assist investigators by automating entity resolution, generating risk narratives, and suggesting supporting documentation from historical case libraries.

Banks utilising AI-assisted SAR preparation tools have observed up to a 30% improvement in the quality assessment scores provided by regulators during audits, alongside a 25% reduction in average SAR submission timelines. In high-volume reporting environments, such gains materially reduce regulatory friction and demonstrate proactive compliance postures.

Real-Time Customer Risk Profiling And Dynamic KYC

Traditional KYC frameworks are inherently static, capturing customer information at onboarding and updating it at set intervals. However, customer risk profiles are dynamic by nature, influenced by behavioural shifts, market developments, and geopolitical changes.

AI enables continuous monitoring of customer activity and triggers real-time updates to risk classifications when deviations are observed. This ensures that Enhanced Due Diligence (EDD) requirements are met promptly and that institutions maintain up-to-date risk assessments as mandated under global regulatory frameworks such as the European Union’s AML Directives and the UK’s Money Laundering Regulations 2017.

Dynamic KYC not only strengthens compliance robustness but also improves the customer experience by reducing the frequency of intrusive documentation requests, replacing periodic reviews with event-driven updates.

Resource Optimisation And Cost Management

AML compliance has traditionally been an expensive function to maintain, with major banks often employing thousands of staff dedicated to transaction monitoring, case investigation, and regulatory reporting. 

AI delivers material cost savings by automating routine tasks, improving case prioritisation, and enabling investigators to handle more cases without proportional increases in headcount. Several Tier-1 banks have reported operating expense reductions of 10–15% in compliance divisions after full AI deployment, enabling reallocation of budgets towards strategic initiatives such as financial crime prevention innovation and regulatory technology (RegTech) adoption.

Enhanced Risk-Based Approach Alignment

Modern regulatory frameworks increasingly mandate a risk-based approach (RBA) to AML compliance, requiring institutions to allocate resources proportionately to customer and transaction risk. AI-powered solutions naturally align with this expectation by enabling dynamic, granular risk scoring, predictive behavioural modelling, and intelligent escalation workflows.

Institutions able to demonstrate genuine risk-based decision-making through AI analytics enjoy enhanced regulatory credibility, often receiving reduced scrutiny in routine examinations compared to peers still reliant on rigid, rules-only compliance models.

Challenges In Using AI For AML

While Artificial Intelligence (AI) offers transformative potential in Anti-Money Laundering (AML) compliance, it simultaneously introduces a distinct set of operational, regulatory, and ethical challenges. Financial institutions must address these complexities proactively to realise the full benefits of AI adoption without exposing themselves to additional compliance and reputational risks.

Model Explainability And Regulatory Scrutiny

One of the most pressing challenges is the explainability of AI models, particularly those built using complex machine learning techniques such as deep learning or ensemble methods. Regulatory frameworks, including the European Banking Authority’s guidelines on the use of machine learning in financial services, emphasise the need for models to be interpretable, auditable, and understandable by both compliance teams and regulators.

Supervisory authorities expect institutions to provide clear rationales for why a particular alert was generated, why a customer was assigned a specific risk rating, or why a transaction was flagged as suspicious. Black-box models, which deliver accurate outputs without transparent logic, risk being non-compliant with regulatory expectations, leading to enforcement actions or required remediation.

Data Privacy And Ethical Considerations

AML compliance increasingly intersects with data protection regimes such as the General Data Protection Regulation (GDPR) in Europe, the California Consumer Privacy Act (CCPA) in the United States, and India’s Digital Personal Data Protection Act, 2023. AI models rely on vast datasets, often including sensitive personal information, to train and operate effectively.

Institutions must balance the need for effective financial crime detection with data minimisation principles, ensuring that data usage remains proportionate, relevant, and legally justified. Inadequate data governance, unconsented data usage, or failure to establish lawful bases for processing can expose institutions to significant fines and reputational damage. For instance, GDPR-related fines in the financial sector increased significantly, according to the DLA Piper Data Breach Report.

Model Bias And Fairness

AI models are only as good as the data they are trained on. If historical datasets contain inherent biases, such as disproportionate scrutiny of specific nationalities, regions, or customer profiles, AI systems may inadvertently perpetuate or exacerbate these biases. Biased models can lead to discriminatory outcomes, unfair risk assessments, and increased regulatory exposure under anti-discrimination laws.

To mitigate this, financial institutions must implement robust model validation, fairness testing, and bias remediation protocols as part of their broader model risk management frameworks. FATF’s guide on digital transformation in AML stresses the importance of ensuring that AI deployment does not undermine human rights or lead to unjustified profiling.

Operational Integration And Legacy System Constraints

Integrating AI solutions into existing AML frameworks is a non-trivial task, particularly for institutions burdened with legacy systems that were never designed for high-velocity data ingestion or real-time analytics. Achieving seamless interoperability between AI platforms, core banking systems, and case management tools often requires significant investment in data architecture, API integration, and infrastructure modernisation.

Without proper integration, the benefits of AI, such as real-time risk updates and dynamic transaction scoring, may remain theoretical, leaving institutions operating in a fragmented, inefficient environment that fails to meet heightened regulatory expectations.

Regulatory Hesitancy And Divergent Jurisdictional Standards

While progressive regulators in jurisdictions like Singapore, the United Kingdom, and the European Union are actively encouraging responsible AI adoption in AML, other regions exhibit cautious or fragmented approaches. Divergent regulatory attitudes towards AI introduce complexity for multinational institutions, which must navigate inconsistent expectations, differing model validation standards, and variable supervisory scrutiny across markets.

AI In The Next Generation Of AML

As the global financial crime landscape continues to evolve, the role of Artificial Intelligence (AI) in Anti-Money Laundering (AML) is expected to mature from operational enhancement to strategic, systemic integration. The next generation of AI-driven AML will not merely support compliance processes but fundamentally reshape how institutions prevent, detect, and respond to financial crime risks.

Predictive Compliance And Proactive Risk Management

AI’s future role is likely to shift from retrospective analysis to proactive risk identification. Predictive compliance involves anticipating potential risks before they materialise by analysing behavioural patterns, transaction anomalies, geopolitical developments, and emerging criminal typologies in real-time.

Financial institutions are already piloting predictive models that generate early warning signals for potential regulatory breaches or client escalations. Such capabilities will enable institutions not only to fulfil reporting obligations but to genuinely contribute to national and international financial crime prevention objectives.

Federated Learning And Privacy-Preserving AI

One of the major challenges facing AI adoption in AML is access to diverse, high-quality data without violating data privacy laws. Federated learning — a technique where AI models are trained across multiple decentralised datasets without the data ever leaving its location — offers a solution. Federated learning allows financial institutions to collaborate in improving detection models while maintaining data confidentiality. 

Self-Learning And Adaptive Models

Traditional machine learning models require periodic retraining and validation cycles to remain effective. However, advancements in reinforcement learning and adaptive AI techniques are paving the way for models that can self-learn from new inputs, adjusting their parameters dynamically without constant human intervention.

In the AML context, this would allow for real-time recalibration of detection thresholds, customer risk scores, and typology identification based on evolving transaction patterns and external intelligence inputs. Such adaptive capabilities could be critical in countering rapidly changing financial crime techniques, such as trade-based money laundering and cryptocurrency obfuscation methods.

Collaborative Investigations Supported By AI

Financial crime is inherently cross-border, yet AML investigations remain largely siloed within institutions. Going forward, AI is expected to play a greater role in enabling collaborative investigations, where anonymised risk signals, typology patterns, and suspicious activity indicators are securely shared between institutions, law enforcement, and regulators.

Initiatives like the Financial Crime Data Foundation in the UK and the MAS-led Collaborative Sharing of ML Solutions in Singapore are early examples of this shift. AI will act as a facilitator — aggregating signals from multiple entities, enriching case intelligence, and enabling faster, more informed interventions against sophisticated laundering networks.

Evolution Of Regulatory Frameworks To Support AI Innovation

Regulators globally are recognising the inevitability of AI’s role in AML and are moving towards providing structured guidance to balance innovation with governance. The European Union’s Artificial Intelligence Act, currently under legislative review, includes specific provisions related to high-risk AI applications in financial services.

Conclusion

The convergence of Artificial Intelligence (AI) and Anti-Money Laundering (AML) represents one of the most significant changes in financial crime risk management in recent decades. No longer a theoretical prospect, AI is now a proven enabler of more effective, efficient, and sustainable compliance frameworks. Institutions that have successfully integrated AI into their AML operations are reaping tangible benefits: sharper detection of illicit activity, materially reduced false positives, enhanced regulatory reporting quality, and optimised resource allocation.

However, the deployment of AI in AML is not without its complexities. Institutions must navigate stringent regulatory expectations around model explainability, data privacy, bias mitigation, and operational governance. Success will depend not only on technological sophistication but also on robust model risk management practices, continuous stakeholder engagement, and a strategic commitment to responsible innovation.

By Abhinandan, ago

Redo KYC Before June 30: FIU-IND’s Mandate

Introduction

The Financial Intelligence Unit-India (FIU-IND) has recently issued a notification that could change the compliance environment for cryptocurrency exchanges operating in India. In alignment with the Prevention of Money Laundering Act (PMLA), the FIU has mandated that all crypto exchanges must redo Know Your Customer (KYC) procedures for their users before June 30, 2025.

This directive highlights a larger regulatory push to ensure that Virtual Digital Asset (VDA) platforms implement robust identity verification mechanisms and manage financial risks effectively.

What FIU’s Notification Means For Crypto Exchanges

Under the new guidelines:

  1. Exchanges must update user details comprehensively.

  2. Fresh KYC must be conducted for accounts older than 18 months.

  3. Enhanced due diligence is required for high-risk accounts, demanding additional documentation and information.

This move signals the government’s intent to tighten oversight on crypto transactions and ensure platforms are not used for money laundering, fraud, or other illicit activities.

The Increasing Importance Of Seamless Digital KYC

The need for quick, reliable, and compliant KYC processes has never been more pressing. Crypto exchanges must rethink their onboarding and verification processes to meet these stringent demands without compromising user experience.

Traditional manual KYC methods are time-consuming, error-prone, and costly. Digital verification solutions, powered by advanced APIs and real-time data validation, offer a scalable and secure alternative.

At AuthBridge, we have been at the forefront of enabling enterprises to achieve faster, safer, and compliant identity verification across industries, and the crypto sector is no exception.

By integrating AuthBridge’s verification solutions, exchanges can not only comply with the FIU’s directives but also build greater trust with users and regulators alike.

Conclusion: Compliance As A Competitive Advantage

As India sharpens its regulatory frameworks around cryptocurrencies, compliance will no longer be a back-end function — it will become a core competitive differentiator.

Exchanges that invest early in AI-powered, API-first verification platforms like AuthBridge’s will be better positioned to scale sustainably, avoid penalties, and foster greater confidence among users and investors.

At AuthBridge, we remain committed to partnering with organisations to help them stay ahead of regulatory changes with innovative, reliable, and secure digital verification technologies.

By Siddharth, ago
Why-Conduct-BGV-Of-Companies--Lessons-From-A-Recent-Fraud

Why Conduct BGV Of Companies? Lessons From A Recent Fraud

In a recent case of surprising events, a company once hailed for its meteoric rise in the renewable energy space has now been at the centre of a massive fraud scandal, leaving investors in shock and financial distress. The firm, known for its impressive growth trajectory and bold promises, was revealed to have engaged in dubious financial practices, resulting in a dramatic collapse. For anyone looking to invest or partner with such companies, this is a stark reminder of the critical importance of verifying a company’s financial and operational health before making any business decisions.

The sequence of events that led to this scandal highlights several key red flags that investors and regulatory authorities missed. From inflated financial statements to questionable governance practices, this case showcases why thorough company verification, including thorough checks like MCA verification, is essential. In this blog, we will explore the details of the fraud, how it unfolded, and why company verification is the best safeguard against such risks.

The Sequence Of Events: How The Fraud Unfolded

The Rise Of The Firm In Clean Energy And Sustainable Mobility

The company at the centre of this scandal had once been hailed as a leading innovator in India’s clean energy and electric vehicle (EV) sectors. With bold promises of transforming urban mobility through sustainable solutions, the firm quickly gained attention. Specialising in electric vehicles, battery technology, and charging infrastructure, the company attracted significant investments from both domestic and international investors.

By early 2024, the company’s stock price had risen dramatically, making it a prominent name in India’s green tech ecosystem. Its ambitious plans and rapid growth positioned it as a leading figure in the electric mobility space, with high expectations for long-term success.

Financial Irregularities And Mismanagement

However, despite its apparent success, the company soon showed signs of financial mismanagement. Investigations revealed that substantial funds intended for EV fleet expansion were diverted for personal use by the company’s executives. The firm had secured a loan of ₹663 crore from public-sector lenders to purchase and lease electric vehicles. These vehicles were supposed to be used by a ride-hailing service in India, which was a partner of the firm.

Unfortunately, a significant portion of the loan was misallocated. While the company had claimed that the loan would support the expansion of the electric vehicle fleet, funds were instead redirected towards luxury real estate purchases and other personal expenses of the executives. This mismanagement sparked serious concerns about the company’s financial integrity and its leadership’s role in the fraud.

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Regulatory Actions And Credit Rating Downgrades

In response to the growing concerns and multiple whistleblower reports, regulators began to take action. The Securities and Exchange Board of India (SEBI) intervened in April 2025, issuing an interim order to suspend the company’s promoters from holding positions in the firm and from participating in the securities market. SEBI’s investigation found that the company had defaulted on loans totalling approximately ₹978 crore, with no clear path to repayment.

In light of these developments, CARE Ratings — one of India’s leading credit rating agencies — took the drastic step of downgrading the company’s rating from AA to D, reflecting its inability to meet obligations and signalling financial default. This downgrade sent shockwaves through the market, significantly impacting investor confidence. The company’s stock price plummeted by more than 90%.

Operational Disruption And Asset Seizure

As the company’s financial situation worsened, operations with its key business partners, particularly those reliant on its electric vehicle fleet, came to a halt. This disruption in the service provider’s operations, coupled with a cessation of lease payments, further deepened the financial strain. Public sector lenders, fearing that the company’s loan account would soon become a non-performing asset (NPA), began preparing to auction off the electric vehicles that had been leased out as collateral for the loans.

This move to sell off assets was a last-ditch effort by the lenders to recover the outstanding loan amounts, but it also marked the beginning of the end for the company’s operations in the clean energy space.

Leadership Failures And Governance Issues

At the heart of the crisis was a complete breakdown of corporate governance. The company’s leadership, particularly the actions of the executives at the top, allowed these fraudulent activities to continue unchecked for months. There were no effective mechanisms in place to monitor and prevent financial mismanagement. Despite early warning signs, the company’s board of directors failed to take timely action, further compounding the damage.

As the crisis escalated, several senior executives were forced to resign. This included individuals who had been closely associated with the company’s financial decisions. The failure to perform adequate background checks and leadership due diligence allowed these individuals to operate with little accountability, ultimately leading to the company’s collapse.

The Importance Of Company Verification And Leadership Integrity

The Case For Thorough Company Verification

This recent collapse of a high-profile company in the clean energy and electric vehicle (EV) sector has brought to light a key lesson for investors, businesses, and financial professionals alike: thorough company verification is non-negotiable. The company rose rapidly through the ranks, attracting substantial capital and promising to transform India’s green energy space. However, behind its meteoric rise, financial mismanagement and corporate misgovernance were lurking, eventually causing its downfall.

Investors and stakeholders alike were left reeling when it was revealed that the company’s financial statements had been manipulated, with inflated revenues and misappropriated funds. This could have been identified sooner with thorough MCA verification. Through detailed checks into a company’s financial history, legal compliance, and corporate records, businesses and investors can uncover key red flags—discrepancies that indicate potential risks, such as unreported liabilities, excessive debt, or mismanagement of assets.

Leadership Integrity For Sound Corporate Governance

While company verification offers an essential foundation, leadership verification is just as important when it comes to safeguarding business interests. The firm involved in this scandal offers a strong case study in how poor leadership oversight and a lack of corporate governance contributed to the misuse of funds and fraudulent reporting. The executives who managed the company failed to provide adequate checks, allowing the fraudulent activities to persist unchecked.

Leadership verification is essential for ensuring that the individuals at the top of an organisation have a proven track record of financial responsibility, ethical decision-making, and sound governance. When verifying a company, it’s just as important to verify those who lead it. Background checks on key executives, including assessments of their past roles, criminal histories, and business dealings, help ensure that an organisation’s leadership is aligned with best practices in corporate governance and ethical conduct.

Proper leadership checks can serve as an early warning system, alerting stakeholders to risks tied to individuals who might be involved in unethical practices or prior financial misconduct.

How AuthBridge’s Verification Services Mitigate Risk

At AuthBridge, we recognise the key role that both company verification and leadership verification play in protecting investors and business partners from fraud. Our comprehensive MCA Verification service goes beyond basic checks by providing detailed insights into a company’s legal standing, financial compliance, and corporate governance practices. With MCA verification, businesses can ensure that they are engaging with firms that are legally compliant and financially sound, reducing the risk of engaging in partnerships with companies that have hidden liabilities or fraudulent practices.

In addition, our Leadership Verification service offers an in-depth assessment of the senior executives running an organisation. We provide background checks on individuals, including criminal records, business history, and any past involvement in financial misconduct. This ensures that key decision-makers have a history of ethical conduct and financial prudence, giving you confidence that your business partner is someone who can be trusted to act in the company’s long-term interest.

By Abhinandan, ago
aml-inbanking-blog-image

AML In Banking: Trends, Challenges And The Road Ahead

Introduction

Money laundering remains one of the most pressing threats to the global financial ecosystem. As illicit funds flow through legitimate financial institutions, banks increasingly find themselves on the front lines of the battle against financial crime. According to the United Nations Office on Drugs and Crime (UNODC), between 2% and 5% of global GDP, roughly $800 billion to $2 trillion laundered every year. These staggering figures underscore the critical role of Anti-Money Laundering (AML) efforts in the banking sector.

AML in banking refers to a suite of laws, policies, technologies, and internal practices designed to detect, prevent, and report suspicious financial activity. With digital banking and cross-border transactions on the rise, traditional methods of AML enforcement are proving insufficient. In response, financial institutions are turning to advanced analytics, artificial intelligence (AI), and regulatory technology (RegTech) to stay ahead of evolving threats.

The need for robust AML frameworks has never been more urgent. Global watchdogs such as the Financial Action Task Force (FATF) and national regulators are intensifying scrutiny, issuing heavy penalties for non-compliance. In 2022 alone, financial institutions across the globe faced over $5 billion in AML-related fines, highlighting the real financial and reputational risks involved.

The Evolution Of AML In Banking

Anti-Money Laundering regulations have evolved significantly over the past few decades, transitioning from basic record-keeping requirements to sophisticated risk-based frameworks integrated with cutting-edge technology. In India, the evolution of AML practices can be traced back to the enactment of the Prevention of Money Laundering Act (PMLA) in 2002. This legislation laid the groundwork for modern AML protocols, empowering regulatory bodies to tackle financial crimes more proactively.

The Reserve Bank of India (RBI) further strengthened compliance by issuing guidelines for banks and financial institutions to implement robust Know Your Customer (KYC) procedures. Over time, these mandates expanded to include transaction monitoring, suspicious activity reporting (SAR), and the creation of internal AML cells within banks. The RBI’s push towards digitisation has only accelerated this evolution.

Globally, AML enforcement gained momentum with the establishment of the FATF in 1989, followed by widespread adoption of its recommendations. In India, FATF’s mutual evaluations have driven the banking sector to align closely with global standards. The introduction of the Financial Intelligence Unit – India (FIU-IND) has also been pivotal in enabling the collection and analysis of financial data related to money laundering.

With the advent of fintech and increasing reliance on digital payment systems such as UPI, NEFT, and mobile wallets, the complexity of financial ecosystems in India has deepened. This shift has led to a new era of AML, where banks are no longer simply watchdogs—they are data-driven sentinels relying on real-time surveillance, behaviour analytics, and machine learning models to detect financial crime.

Key Challenges In AML For Banks

  • High Transaction Volumes:
    Banks must monitor millions of transactions daily, making it difficult to detect suspicious patterns in real time.

  • False Positives in Monitoring:
    Rule-based systems often generate excessive alerts, most of which are false positives—wasting time and resources on manual reviews.

  • Fragmented Data Systems:
    Customer and transaction data are often siloed across departments, preventing a unified risk view and effective monitoring.

  • Evolving Laundering Techniques:
    Criminals exploit cryptocurrencies, shell companies, and complex layering methods that traditional AML systems struggle to track.

  • Balancing Compliance and Customer Experience:
    Banks must enforce strong AML measures without creating friction for legitimate customers expecting fast and seamless service.

Regulatory Expectations And Compliance Frameworks In 2025

As financial crime grows more complex, regulatory authorities worldwide are stepping up expectations from banks to ensure robust AML compliance. The focus has shifted from mere policy adherence to demonstrable, outcome-based risk management.

Below are the key regulatory expectations shaping the AML landscape in 2025:

  • Risk-Based Approach (RBA):
    Regulators now demand that AML programmes be tailored to the specific risk exposure of a financial institution. This includes customer risk profiling, transaction risk scoring, and sectoral risk evaluation. One-size-fits-all compliance is no longer acceptable.

  • Enhanced Due Diligence (EDD):
    Institutions are expected to conduct EDD for high-risk customers such as politically exposed persons (PEPs), offshore entities, and businesses operating in high-risk jurisdictions. This involves collecting more detailed documentation and ongoing monitoring of account activity.

  • Real-Time Transaction Monitoring:
    Regulatory bodies are emphasising the need for continuous, real-time transaction monitoring using AI-powered systems, rather than relying solely on post-facto reviews. This ensures timely reporting of suspicious activities.

  • Robust Record-Keeping & Audit Trails:
    Financial institutions must maintain digital audit trails and comprehensive records of all customer interactions, transactions, and compliance reviews for a minimum of five years, as per FATF and local jurisdictional standards.

  • Integrated KYC-AML Compliance:
    Regulators are pushing for tighter integration between Know Your Customer (KYC) and AML functions. KYC data should feed directly into AML decision-making systems to enable more accurate risk assessments and fraud detection.

  • Automated Suspicious Activity Reporting (SAR):
    Compliance teams must implement automated SAR generation and filing mechanisms that align with local formats (e.g., STRs in India). Delays or manual handling of such reports could result in hefty penalties.

  • Third-Party & Vendor Risk Management:
    AML regulations now extend to third-party due diligence, requiring financial institutions to assess the risk profiles of vendors and partners, especially in outsourcing arrangements for KYC, collections, or onboarding.

  • Cross-Border Compliance Alignment:
    For banks operating in multiple geographies, there is a growing need to harmonise their AML processes with both local and international regulatory frameworks (e.g., EU’s AMLD6, USA’s Bank Secrecy Act, India’s PMLA).

These frameworks are not just compliance mandates—they reflect a broader shift towards accountability, transparency, and proactive financial crime prevention.

Future Trends In AML For Banks

As financial crime continues to evolve, AML strategies must advance in parallel. The future of Anti-Money Laundering in banking will be defined by agility, automation, and intelligence. Financial institutions are no longer reactive entities; they are expected to predict and pre-empt risks before they escalate. Below are the key trends poised to shape AML practices in the years ahead:

  • Agentic AI and Autonomous Compliance Systems
    Agentic AI, which enables systems to act independently to complete tasks, is set to redefine AML operations. From initiating verification checks to closing compliance loops, autonomous agents will minimise human intervention while accelerating resolution times and boosting accuracy.

  • Holistic Identity Resolution
    AML efforts will increasingly depend on unified identity frameworks that consolidate data from multiple sources—HRMS, onboarding platforms, digital IDS, and external databases—into a single, verifiable customer profile. This helps in identifying risk at both the individual and network levels.

  • Behavioural Biometrics and Advanced Risk Scoring
    Financial institutions will begin leveraging behavioural analytics, such as typing patterns, device usage, and navigation behaviour, to build predictive risk scores. These scores will complement traditional KYC data to uncover anomalies early in the transaction lifecycle.

  • Global Data Collaboration and Utility Models
    To combat transnational money laundering, regulators and banks will embrace collaborative platforms and shared intelligence frameworks. The adoption of KYC utilities, centralised AML databases, and real-time information exchange will gain momentum.

  • RegTech-Driven AML Orchestration
    Regulatory Technology (RegTech) will enable end-to-end orchestration of AML compliance—right from data capture and screening to real-time reporting and audit readiness. API-first, cloud-native platforms will become the gold standard in compliance infrastructure.

  • Sustainability-Linked AML Risk Assessments
    ESG (Environmental, Social and Governance) considerations are beginning to influence AML strategy. Banks will start integrating ESG risk factors into AML assessments, particularly for industries linked to environmental crime, human trafficking, or corruption.

  • Zero-Trust Architecture for AML Systems
    With increasing cybersecurity threats, AML platforms will be built using zero-trust principles—ensuring every access point, user, and dataset is authenticated, authorised, and monitored at all times.

These trends collectively point to a future where AML is intelligent, automated, and deeply integrated into every layer of banking infrastructure. For banks willing to adapt, the opportunity lies not just in compliance—but in gaining a strategic edge.

Conclusion

Anti-Money Laundering is no longer just a regulatory obligation—it is a cornerstone of institutional integrity and risk management. In an age of real-time transactions, global digital banking, and sophisticated criminal networks, AML must evolve from reactive compliance to proactive defence.

Banks today are faced with an unprecedented dual challenge: safeguarding against financial crime while ensuring seamless customer experiences. The only viable path forward is through innovation—leveraging AI, automation, and integrated compliance frameworks that offer both agility and accountability.

Regulatory expectations will continue to rise, and penalties for non-compliance will grow increasingly severe. But for banks that choose to invest in modern, data-driven AML systems, the benefits go beyond regulatory safety. They gain reputational trust, operational efficiency, and the ability to stay one step ahead in a constantly shifting financial landscape.

By Siddharth, ago
Banking Amendment Laws 2025

Banking Laws (Amendment) Act, 2025: All Key Highlights

On 15th April 2025, the Banking Laws (Amendment) Act, 2025 received the assent of the President, marking a watershed moment in India’s banking history. This amendment significantly changes several foundational banking statutes, including the Reserve Bank of India Act, 1934, the Banking Regulation Act, 1949, the State Bank of India Act, 1955, and the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980.

The amendments are part of an ongoing effort to streamline and modernise the regulatory framework governing India’s banking sector. The changes address a range of issues, from the handling of unclaimed deposits to the governance of banking institutions, aiming to enhance operational efficiency, transparency, and regulatory oversight.

These revisions come at a time when India’s banking sector is undergoing digital transformation, and the need for updated and stronger laws has never been greater. As the economy becomes more digitally connected, ensuring that banking laws adapt to meet new challenges is crucial for maintaining stability and fostering growth.

Key Highlights Of The Banking Laws (Amendment) Act, 2025

The Banking Laws (Amendment) Act, 2025, brings forward several significant amendments aimed at refining and modernising India’s banking landscape. The changes affect various critical acts, including the Reserve Bank of India Act, 1934, the Banking Regulation Act, 1949, the State Bank of India Act, 1955, and the Banking Companies (Acquisition and Transfer of Undertakings) Acts of 1970 and 1980. Below is an overview of the amendments.

1. Amendment to the Reserve Bank of India Act, 1934

  • Fortnight Definition:
    • The definition of “fortnight” has been updated to mean the period from the 1st to the 15th day of each calendar month, or from the 16th to the last day of the month. This clarification will standardise timelines for operational activities, enhancing consistency across financial operations.
  • Operational Timelines:
    • The amendment replaces the term “alternate Friday” with “last day of each fortnight”, streamlining how banking operations are scheduled. This update also changes the previous reference to “seven days” for operational timelines, reducing it to “five days” for certain compliance activities, improving operational efficiency.

2. Amendment to the Banking Regulation Act, 1949

  • Minimum Capital Requirement:
    • The minimum capital required for certain banking activities has been increased significantly from five lakhs of rupees to two crore rupees or an amount notified by the Central Government in the Official Gazette.
  • Directorial Tenure in Cooperative Banks:
    • The amendment revises the tenure for directors of cooperative banks. Directors can now serve up to ten years, extending the previous limit of eight years. This is aimed at fostering stability in management at cooperative banks.
  • Nomination Changes:
    • Multiple Nominees:
      • The Act now allows up to four nominees to be nominated for a single account or deposit. If more than one nominee is chosen, the proportion of the share for each nominee must be specified.
      • In the event of a nominee’s death, the nomination for that individual becomes invalid, and the remaining shares will be redistributed according to the remaining valid nominees.
    • Successive and Simultaneous Nominations:
      • The Act distinguishes between successive and simultaneous nominations.
      • Successive nominations will take effect in a specified order, starting with the first nominee. If the first nominee is no longer available, the next in line will take precedence, and so on.
      • Simultaneous nominations require that the proportionate share of the amount be stated explicitly. Each of the nominees’ shares will be paid out in the proportions specified by the account holder.
    • If the account holder does not specify proportions, the nomination will be rendered invalid.
    • Nomination for Locker Holders:
      • When it comes to lockers, the Act now allows up to four nominees for a single locker. The proportion of access to the locker’s contents can be specified for each nominee. In case the locker holder dies, the nominees will gain access according to the order of priority.

3. Amendment to the State Bank of India Act, 1955

  • Unclaimed Funds and Dividends:
    • In line with the reforms, the State Bank of India Act, 1955 requires that unclaimed dividends, unpaid money, and unclaimed shares be transferred to the Investor Education and Protection Fund (IEPF) after seven years.
    • This ensures better accountability and ensures that dormant funds are handled in a transparent manner. Shareholders can claim their unpaid dividends or funds from the IEPF.
  • Auditor Remuneration:
    • The Act has been amended to align with the Companies Act, 2013, with the State Bank now required to fix auditor remuneration according to the guidelines of the modern regulatory framework.

4. Amendment to the Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970 and 1980

  • Unclaimed Funds:
    • Similar to the provisions in the State Bank of India Act, unclaimed funds from acquired banks will now be transferred to the Investor Education and Protection Fund after seven years.
  • Simplified Dividend Procedures:
    • Unpaid dividends, shares, and other forms of unpaid money must be transferred to the IEPF, ensuring that dormant assets are properly managed and that no assets remain unaccounted for.

5. Nomination and Inheritance Changes

  • Multiple Nominees (Up to Four):
    • A critical change introduced is the maximum number of nominees allowed. The law now permits the nomination of up to four individuals, either successively or simultaneously.
    • For successive nominations, the order of priority must be clear. The first nominee will be given precedence, followed by the second nominee if the first one passes away, and so on.
    • For simultaneous nominations, the proportions of the total amount each nominee is entitled to must be clearly stated. If this proportion is not specified, the nomination will be considered invalid.
  • Locker Nomination Provisions:
    • In the case of locker holders, a depositor can nominate up to four individuals. The proportion of the locker’s contents assigned to each nominee must be stated explicitly. If a nominee passes away before accessing the locker, the rights to that portion will lapse, and the remaining nominees will take precedence.
    • The nomination rules for lockers mirror those for deposits, ensuring clarity in the event of the locker holder’s death.
  • Changes to Nomination Inheritance:
    • In case of multiple nominees, the priority follows a clear order of succession:
      • The first nominee’s right is activated if they survive the account holder(s).
      • If the first nominee passes away, the second nominee’s rights will come into play, followed by the third, and so on. This systematic order eliminates confusion over the rights of the nominees and ensures clarity regarding the inheritance of banking assets.

6. Other Key Amendments

  • Operational Days and Terms:
    • The amendment also introduces changes in operational days: references to alternate Fridays have been replaced with the last day of the fortnight, ensuring consistency in banking practices.
  • Cooperative Bank Management:
    • The amendment permits directors of central cooperative banks to be elected to the boards of state cooperative banks where they are members, enhancing governance and cooperation between institutions.
  • Simplification of Procedures:
    • There are several provisions aimed at simplifying operational and procedural requirements for banks, particularly in relation to unclaimed funds and handling shares, ensuring smoother transactions and compliance with modern financial regulations.

When Will The New Banking Law Amendments Come Into Effect?

The Banking Laws (Amendment) Act, 2025, is set to be implemented in phases. While the Act received Presidential assent on 15th April 2025, its provisions will come into force on a date to be notified by the Central Government.

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As stated in the Act, different provisions of the amendment will come into force on different dates. This means that while some provisions will take effect immediately, others may be implemented over time, based on the requirements and readiness of the regulatory authorities, financial institutions, and businesses involved.

It is important to note that once the provisions come into force, any reference in the Act to its commencement will refer to the specific dates when each provision is activated.

What Does This Mean for Banks and Consumers?

For banks, the implementation of the Act will require them to update their operational procedures to reflect the changes in nomination rules, fund management, and governance structures. Banks will need to ensure that their systems and customer interactions align with the new provisions, such as the acceptance of multiple nominees and the transfer of unclaimed funds to the Investor Education and Protection Fund (IEPF).

For consumers, this phased implementation means they will need to stay informed about the changes, especially regarding nominee designations, unclaimed funds, and any updates to their banking accounts or lockers. Consumers should expect communication from their banks regarding these changes and may be required to update their account details to comply with the new rules.

The Central Government will issue a notification in the Official Gazette specifying the exact dates for the commencement of these provisions. Once the notifications are issued, the banking sector will be fully equipped to implement the changes as per the new legal framework.

To ensure you’re fully prepared for these changes, it’s crucial to:

  • Review your banking accounts: Check the nomination details, ensure you have named sufficient nominees, and update your personal information if needed.

  • Stay informed: Keep an eye out for notifications from your bank regarding implementation dates and necessary actions on your part.

  • Engage with your bank: If you have any questions about how the amendments will affect your accounts, do not hesitate to reach out to your financial institution for clarity.

Conclusion

The Banking Laws (Amendment) Act, 2025, is a clear sign that India’s banking sector is evolving to meet modern challenges and global standards. By understanding and adapting to these new laws, you can ensure that your financial dealings remain secure, efficient, and compliant.

By Abhinandan, ago

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