'De-risking' is the buzzword of the day among anti-money laundering specialists, who are now operating in an environment of fear with increased regulation and more prevalent fines. Some banks have responded by dropping ‘risky’ clients, but now there are fears that de-risking has gone too far, coming at the expense of financial inclusion.
Banks are caught in a contradiction. If they don’t comply with money laundering regulations, they could be fined billions of dollars. At the other extreme, if they cut access to certain markets, they stand accused of stemming transactions to developing economies, causing major hardships for the people who relied on them.