ACDIRP AFRICAN CUSTOMER DUE DILIGENCE REPOSITORY. June 12, Maureen MBA Head of Compliance

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1 AFRICAN CUSTOMER DUE DILIGENCE REPOSITORY ACDIRP June 12, 2015 Maureen MBA Head of Compliance Lusaka, 8 14 June Juin

2 Introduction Afreximbank s objective is to promote and expand intra and extra African trade particularly exports from Africa, with a Vision to be The Trade Finance Bank For Africa There have been challenges which create barriers to trade in Africa. During the maiden Customer Due Diligence and Corporate Governance Forum, held in Dakar, Senegal, in October, 2014, there was an Agreement on the need for an African-focused Customer Due Diligence Repository. Lusaka, 8 14 June Juin

3 Purpose Afreximbank has taken a lead role in creating a platform to cover Customer Due Diligence (CDD)/Know Your Customer (KYC) issues, with a special emphasis on African financial Institutions and Corporate Entities. The Repository to be created will be called African Customer Due Diligence Repository (ACDIRP) ACDIRP will enable global financial institutions particularly the Bank s partners to access the CDD information on African financial institutions and corporate entities, cost efficiently. The aim of ACDIRP is to provide a central source of primary and authentic data required to conduct customer due diligence checks on counterparties in Africa. It aims to be the primary resource to help African financial institutions and other corporates comply with increasing regulations, and to provide anti-money laundering professionals with a centralized source of due diligence information about African financial institutions and corporates. Lusaka, 8 14 June Juin

4 The need for an African-Focused Repository Increased global financial flows and rise in financial crimes including money laundering, bribery and corruption Global Financial Flows Regulations Introduction and enforcement of new, and more stringent regulatory requirements Inadequate Information Cost of Compliance Lack of adequate information on African Counter Parties Financial burden and high cost of compliance Lusaka, 8 14 June Juin

5 The need for an African-focused repository Increasing Regulations and Compliance Requirements An increase in global financial flows and financial crime has led to the introduction and enforcement of various regulations, laws, principles, etc. at national, regional and global levels aimed at curbing fund flows related to these activities. Financial institutions face penalties and sanctions for failure to undertake appropriate due diligence on their counter parties and correspondent banks. Implications of New Regulations on African Entities: High cost of project finance Withdrawal of correspondent banking relationships In access to trade finance services Low export and trade competitiveness Increasing costs of compliance and costs of non-compliance to regulations Lusaka, 8 14 June Juin

6 Developments in Trade Finance 1 Increasing global trade and global customer base 2 Entry of Innovative Trade Finance Products 3 Changing dynamics, rules and trade standards 4 Trade based money laundering now considered a Top Risk Lusaka, 8 14 June Juin

7 Factoring and Receivables Management: Factoring is a form of receivables financing whereby the seller of the goods assigns its receivables to a Factor who performs credit protection, prepayments against accounts receivable, collection of factored debts, credit management and sales ledger administration and analysis. Lusaka, 8 14 June Juin

8 Innovations in Trade Payment Systems Technology will reduce intra-africa trade barriers by removing obstacles, while increasing efficiency and encouraging transparency. Afreximbank has embarked on an initiative to promote and encourage intra-african trade through a mobile platform payment system for cross border trade. The platform will enhance ease with which parties can trade within Africa. Lusaka, 8 14 June Juin

9 Objectives of ACDIRP ONBOARDING REGULATORY RISK COST EFFICIENCY ACDIRP COMPLIANCE PROCESSES CUSTOMER RELATIONS Lusaka, 8 14 June Juin

10 Benefits Of ACDIRP Governance The ACDIRP initiative will promote good governance, transparency and accountability by African entities. Africa-Wide Impact Promote international trade with Africa through lower cost of compliance for international banks and global trading entities in maintaining relationships with African Counter parties. ACDIRP Risk Management Reduce the perceived risk of trading in Africa and mitigate against negative implication of current Client Due Diligence challenges and high risk perception of African entities. Trade Promotion Availability of information on counter-parties will promote intra and extra- African trade, and stimulate uptake of new trade avenues and payment systems such as mobile payment platforms. Lusaka, 8 14 June Juin

11 Way Forward There will be Partnership with Regulators in all member countries on the ACDIRP initiative Afreximbank will perform road shows in a number of Member States to create awareness of the ACDIRP initiative and engage with various stakeholders. Partnership with Regulators Roadshows LAUNCH OF ACDIRP ACDIRP will be domiciled on Afreximbank s website on a dedicated web domain with a dedicated Compliance staff for regular information update. Repository Development Lusaka, 8 14 June Juin

12 All it takes is one insight or idea strongly acted on, to take you to a different place Robin Sharma Thank you for Listening Questions and Comments Lusaka, 8 14 June Juin