Real-time payments monitoring
Also called instant payments monitoring, real-time transaction monitoring
Real-time payments monitoring is the screening and risk scoring of instant payments while they are in flight. Checks for fraud, money laundering and sanctions run in seconds, before funds settle. Instant schemes settle around the clock and cannot be recalled easily, so the decision to release, hold or reject has to be made immediately.
How it works
A payment instruction reaches the bank's monitoring engine through an application interface. The engine scores it against customer behaviour, device data, payee details and risk rules within milliseconds. Low-risk payments pass. Higher scores trigger a hold, a step-up check with the customer or a rejection. Each decision is logged so analysts can review it and feed outcomes back into rules and models.
Instant schemes such as Faster Payments, SEPA Instant and FedNow move money in seconds, and fraudsters move it onward just as fast. Batch monitoring the next day finds losses after the money has gone. In the UK, mandatory reimbursement of authorised push payment fraud puts the cost on sending and receiving firms. In the EU, instant payment rules set strict time limits on every check.
The rules
Requires instant euro transfers within ten seconds and replaces per-transaction sanctions screening with at least daily screening of customers.
Payment service providers offering euro credit transfersRequires sending firms to reimburse in-scope APP fraud victims, with costs split equally between sending and receiving firms.
Payment firms in Faster Payments (SD20) and CHAPS (SD21)Updates payment message data standards and adds fraud and error controls for wire transfers.
Banks and payment providers in FATF member jurisdictionsCommon questions
How fast does real-time payments monitoring need to be?
Fast enough to finish inside the payment scheme's time limit. SEPA Instant transfers must reach the payee within ten seconds, so fraud and risk checks typically run in a few hundred milliseconds.
How is it different from batch monitoring?
Batch monitoring reviews transactions after they settle, often overnight. Real-time monitoring decides before settlement, so a suspicious payment can be held or rejected before the money leaves the bank.
Does real-time monitoring replace batch monitoring?
No. Most firms run both. Real-time checks stop fraud and sanctions breaches in flight. Batch scenarios still look for money laundering patterns that only appear across many payments over weeks or months.
Our coverage
News and analysis on transaction monitoring from RegTech Post.
Read the coverage →RegTech PostHow RegTech Powers Growth in the Age of Real-Time PaymentsRead the article →RegTech PostReal-Time vs Batch AML Monitoring: Key Differences for Compliance TeamsRead the article →
