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The approval of the Financial Action Task Force puts India in a select group with just four other G20 countries | India News
NEW DELHI: India has achieved a remarkable result in the Mutual Assessment conducted during 2023-24 by the Financial Action Task Force (FATF).
India’s assessment report, which was adopted at the FATF plenary held in Singapore between June 26 and 28, places India in the “regular monitoring” category, a distinction shared by only four other G20 countries.
This marks a significant milestone in the country’s efforts to combat money laundering (ML) and terrorist financing (TF).
The FATF recognizes the efforts made by India in:
- Mitigate the risks arising from ML/FT, including the laundering of proceeds from corruption, fraud and organized crime.
- Effective measures implemented by India to transition from a cash-based economy to a digital economy to reduce ML/TF risks.
- The implementation of JAM (Jan Dhan, Aadhaar, Mobile) Trinity, along with stringent regulations on cash transactions, has led to a significant increase in financial inclusion and digital transactions; These measures made transactions more traceable, thus mitigating ML/FT risks and increasing financial inclusion.
What a good ranking means for India
India’s performance in the FATF Mutual Evaluation accrues significant benefits to its growing economy as it demonstrates the overall stability and integrity of the financial system.
Good ratings will lead to better access to global financial markets and institutions and boost investor confidence. It will also help in the global expansion of Unified Payments Interface (UPI), India’s fast payment system.
India is already a member of the FATF Steering Group. India’s current performance will provide India with an opportunity to contribute significantly to the overall functioning of the group.
What the Center said
This FATF recognition is “a testament to the stringent and effective measures implemented by India over the last 10 years to safeguard its financial system from ML/TF threats”, a statement from the Union Finance Ministry said.
“It underscores the country’s commitment to international standards and its proactive stance in the global fight against financial crimes. This sets a benchmark for countries in our region to effectively implement international standards on terrorist financing. India’s excellent ranking will enhance our country’s ability to lead the global effort to combat cross-border terrorist financing and money laundering,” the ministry said.
He further stated that India remains committed to further strengthening its AML/CFT framework and continuing its collaboration with international partners to combat financial crimes. “The nation will build on this success to ensure a safe and transparent financial environment for all,” he added.
About FATF
The Financial Action Task Force (FATF) is an intergovernmental organization established in 1989 as the international watchdog to combat money laundering, terrorist financing and other related threats to the integrity of the international financial system. India became a member of FATF in 2010.