août 18 2025

FATF Revises AML Standards For Certain Funds Transfers

Share

On June 18, 2025, the Financial Action Task Force (“FATF”) revised the Travel Rule requirements for certain funds transfers (the “2025 Revisions”). The 2025 Revisions are intended to adapt anti-money laundering (“AML”) compliance standards to changes in the payments business, including the development of different products and services, new types of market participants, business models, technologies, and messaging standards, as well as evolving risks and vulnerabilities.

The 2025 Revisions generally take effect at the end of 2030 and must be adopted by individual jurisdictions. In this Legal Update, we provide background on the Travel Rule and describe the changes in the 2025 Revisions.

Background

The Travel Rule is a part of AML compliance standards. It specifies the information that certain financial institutions must collect and process in conducting certain types of funds transfers. The purpose of the Travel Rule is to ensure that basic information concerning parties related to a transaction accompanies (travels with) fund transfers as they move from an initiating to a recipient financial institution, so that law enforcement has ready access to information critical to the investigation of money laundering and terrorist financing. 

As with all FATF standards, the Travel Rule is implemented by national regulators. For example, in the United States, the Financial Crimes Enforcement Network requires bank and nonbank financial institutions that send or facilitate certain funds transfers (“transmittals of funds”) to include certain information in a “transmittal order” in the amount of $3,000 or more.1

2025 Revisions

The 2025 Revisions include changes to the Travel Rule (also known as Recommendation 16) and FATF’s interpretive note on the Travel Rule. Most notably, they create new obligations to obtain and transmit information on payment beneficiaries and impose new responsibilities on beneficiaries’ financial institutions to use information for compliance purposes. While only the Travel Rule is part of the international AML standards, FATF interpretive notes are widely relied upon for understanding the AML standards.

The 2025 Revisions specify that the Travel Rule applies to all “payments or value transfers and related messages,” not just wire transfers. The information that must accompany a payment or value transfer should be structured to comply with established standards (e.g., ISO 20022) to the extent possible.

The 2025 Revisions to the interpretive note reflect the changes to the Travel Rule (discussed above) and several other items. Notably, it clarifies that the payment chain starts at the financial institution that receives the instructions from the originator for a transfer of funds to the beneficiary, and ends at the financial institution that services the account of the beneficiary or provides cash to the beneficiary.

It also clarifies that where a net settlement results from payments or value transfers transactions carried out on behalf of customers, information about the underlying transactions is not required to accompany the net settlement. However, the Travel Rule continues to apply the underlying transactions.

In the introduction to the 2025 Revisions, FATF notes that it is not applying the Travel Rule directly to virtual asset service providers (“VASPs”). Instead, the Travel Rule will be applied to VASPs indirectly through the tailored framework for new technologies and the support of the FATF’s Virtual Asset Contact Group.2

Other changes to the interpretive note for the Travel Rule include:

Minimum Required Information
  1. Clarification that information in a payment message should make it possible for all relevant financial institutions and authorities to identify which financial institution is servicing the account of the originator and beneficiary respectively, and in which countries these institutions are located.
    • Financial institutions should ensure that account numbers are not used to disguise the identification of the country where the financial institution that services the account resides.
  2. Clarification that, if funds are drawn from a financial institution other than the ordering financial institution, the account number and the name of the financial institution from where the funds are drawn should be included for all payments and value transfers.
  3. The minimum required information for cross-border payments and value transfers in excess of $1,000 USD/EUR now includes the beneficiary’s name, account number (or unique transfer reference number if no account number is used), and country and town name.
    • If the originator or beneficiary is a legal entity, then one of the following numbers must be included, it exists: (i) the connected business identifier code; (ii) the Legal Entity Identifier; or (iii) a unique official identifier.
    • The minimum required information no longer includes a natural person’s national identity number or customer identification number.
    • If the full information of the date of birth of a natural person originator is not available, only the year of birth is required.3
  4. The minimum required information for domestic payments and value transfers in excess of $1,000 USD/EUR is unchanged. FATF intends to provide a clearer expectation on the requirements applicable to domestic transfers in the future.
  5. The 2025 Revisions do not change the minimum required information for domestic and cross-border payments or value transfers below $1,000 USD/EUR.
Card Payments and Transfers
  1. For purchases of goods or services4 that use a credit, debit, or prepaid card (regardless of amount), the card number should travel with all transfers flowing from the transaction, and the name and location of the card issuing and merchant acquiring financial institutions should be made available upon request.
  2. If a credit, debit, or prepaid card is used for any other type of payment or value transfer, then the general minimum information requirements for domestic and cross-border payments and value transfers apply.
Cash Withdrawals
  1. With respect to cross-border cash withdrawals using a credit, debit, or prepaid card issued by a different financial institution, the card number should travel with the withdrawal and the name of the cardholder should be sent to the acquiring financial institution upon request, within three business days of receiving the request.
  2. No information beyond the account number or card number is required to accompany domestic cash withdrawals.
Use of Minimum Required Information
  1. The 2025 Revisions clarify that the Travel Rule does not itself require real-time sanctions screening, deferring instead to national regulation and industry best-practices.
  2. For cross-border payments or value transfers in excess of $1,000 USD/EUR, the beneficiary financial institution now should use the information it receives regarding the intended beneficiary to inform transaction monitoring. This is intended to detect misdirected payments (e.g., due to possible money laundering, fraud, or error).
  3. Beneficiary financial institutions should take measures to mitigate the risk of transfers being made to an unintended beneficiary. Such measures should consist of at least one of the following: (i) name and account number checks; (ii) “holistic ongoing monitoring” of accounts, transactions, and activity; or (iii) reconciliation of beneficiary information with information received through a prevalidation mechanism.

The responsibilities of other financial institutions in the payment chain are unchanged. However, there is clarification that none of the responsibilities under the Travel Rule for use of minimum required information apply to cash withdrawals and card payments for purchase of goods or services.

Takeaway

FATF stated that it will publish guidance in late 2026 on how jurisdictions may consistently implement the 2025 Revisions. For example, it may identify aspects of the 2025 Revisions that require a longer time to implement (i.e., post-2030). The banking and digital asset sectors should consider engaging with FATF, FATF’s new payment advisory group, and their national AML regulators to shape the guidance and ensure it is useful to financial institutions.

 

 


 

 

1 31 C.F.R. § 1010.410(f).

2 On June 26, 2026, FATF issued Best Practices on Travel Rule Supervision for virtual assets and VASPs.

3 FATF states that it will provide further guidance on what is required where no date of birth information is available or cannot be verified (e.g., unregistered births).

4 The purchase of goods or services refers to purchases from persons who have been onboarded by the relevant financial institution to accept card payments.

Compétences et Secteurs liés

Stay Up To Date With Our Insights

See how we use a multidisciplinary, integrated approach to meet our clients' needs.
Subscribe