Utilities, transfers and accounts: which will be affected by legislation on financial monitoring

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Despite the novelty, many myths and “sensitivities” have already preached honestly about the law.

Payment of communal services, cash transfer and remote identification: which is actually influenced by the law on financial surveillance

Online payments are becoming an increasingly popular and popular operation among Ukrainians, and this is not surprising – in quarantine it is the safest and most convenient way to make payments. But changes are also awaiting this segment: On 28 April, the law will come into force in Ukraine “on the prevention and retaliation of money laundering, the financing of terrorism and the spread of mass destruction of weapons”.

Simply put – a new law on financial monitoring and anonymity of customers, which changes the maximum amount of financial transactions subject to control. Previously, it was a question of amounts from 150 thousand UAH, according to the new rules, operations would be controlled in the amount of 400 thousand UAH.

According to the new rules, foreign and domestic transactions and cash transfers, as well as international and local transfers, will be monitored for amounts up to $ 30 thousand without opening an account (provision of data by sender and sender’s recipient subjected to).

Myth and fear

Despite the novelty, many myths and “sensitivities” have already preached honestly about the law. Yekaterina Rozhkova, the first deputy head of the National Bank of Ukraine, started the most popular debunk among them. First, Catherine assured that the new law would not provoke the expected problems with remote payment of communal services and other “everyday” transfers. In addition, the requirements of the law will not apply to:

  • Payment of taxes, fines, other compulsory payments (regardless of amount);
  • Loan repayment up to 30 thousand dollars;
  • Payment for goods and services using a card or other payment device, if its number is accompanied by a transfer (regardless of amount);
  • All cash transfers up to 5 thousand UAH in Ukraine;
  • Withdraw funds from your account.

Rozkova adopted legislation providing for the stages of preparation for banks and a transitional period for banks. Thus, all market participants will receive additional time to establish procedures and implement new regulatory requirements.

Payment of communal services, cash transfers and remote identification: which is actually influenced by the law on financial surveillance. Photo: Advanced Issue

Regarding remote authentication, there should be no problem. Already, different options have been developed for banks: bank, qualified electronic signature, video transmission, remote reading of data via NFC, payment of a bank account separate from the customer’s personal account. In addition, banks will be allowed to partially outsource KYC.

Regarding the apocalyptic rumors about the destruction of the electronic money market, Rozkova explained: We are only talking about the “gray” segment of the industry. Therefore, the law is obliged to disclose the owners of the electronic purse. To do this, a new identification model has been developed: using copies of documents that must be sent and confirmed by photocopying them with the original.

European Standard and High Risk Customers

According to Rozkova, the main idea of ​​the new law is in a different view. Approach focused on low-risk customers (paying communal services; salary projects, scholarships, pensions; OSMD; housing and communal services enterprises, Internet providers; “white” business that pays taxes). Focusing on low-risk customers will be minimal.

High-risk customers, in turn, include companies registered in offshore countries or countries ignoring the recommendations of the FATF (DPRK and Iran), without a designated beneficiary. Apart from this, we are also talking about public celebrities, politicians and individuals included in the list of sanctions.

It is worth noting that the new version of the legislation aims to adjust standards of integration with the European Union, where they are carefully trying to control the “gray” areas of financial operations. By increasing fines, it will be more profitable for banks to follow the law and refuse to conduct suspicious transactions. The European system has been operating in this mode for a long time and successfully.

Read: New law on financial monitoring: for which bank accounts will freeze


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