Commercial Banks Compliance on the Pillars of Anti-Money Laundering (AML) and Their Know Your Customer (KYC) Practices Towards Ensuring the Integrity of Financial Transactions
Year: 2025
Type: article
Study design: Observational Study
Abstract: This study determined the compliance of Commercial Banks on the pillars of the Anti-Money Laundering (AML) and their Know Your Customers (KYC) Practices in selected cities of the National Capital Region (NCR) with the end view of ensuring the integrity of financial transactions. The respondents are primarily younger professionals, with most aged between 25 and 35 years. The banking sector represented by the study shows a gender imbalance, with a higher proportion of male respondents. The majority of respondents are located in Quezon City, followed by Taguig City, reflecting the concentration of banking operations in these urban areas. Most respondents have mid-level banking experience, with 5 to 10 years of service, indicating that the insights gathered largely represent perspectives from professionals who are familiar with but not senior in the industry. Commercial banks are seen as largely compliant across the major AML pillars. Banks are particularly effective in risk assessment and customer due diligence, though there are some inconsistencies in verifying corporate ownership in the latter. Transaction monitoring is generally practiced well, but there is a need for more consistent application in high-risk transactions. Reporting and record-keeping are compliant, but some respondents suggested improvements in timely reporting. Training and education efforts are adequate, though there is a recommendation for more practical scenario-based training to strengthen AML awareness further. Generally, there are no significant differences in the assessment of AML compliance based on age, location, years of experience, or sex. However, a notable exception is customer due diligence, where male respondents rated the banks' practices slightly higher than female respondents. Banks are seen as effective in implementing KYC practices, especially in the areas of digital identity verification and ongoing monitoring. While address verification is practiced well. There were no significant differences in the overall assessment of KYC effectiveness based on demographic factors. The only significant correlation found was between risk assessment and identity verification.
Institution: Emilio Aguinaldo College
Language: English
Subfield: Finance
Domain: Social Sciences
Open Access status: gold
OpenAlex ID: W4416248008