What is sanctions screening? How payment firms check who they deal with
By SendPay Business · · 2 min read
Sanctions screening is how banks and payment firms check their customers and payments against official lists of people, companies and countries that are subject to sanctions. Dealing with a sanctioned party can be a serious offence, so every regulated money firm screens.
Which lists are used
Each country or bloc keeps its own lists. In the UK, the Office of Financial Sanctions Implementation (OFSI) maintains the list for financial sanctions. The US list is kept by the Office of Foreign Assets Control (OFAC), and the EU and UN keep their own.
When screening happens
- When a new customer signs up.
- Again whenever the lists are updated.
- On payments, checking the payer, the payee and the countries involved.
False matches and held payments
Screening compares names, so a customer who shares a name with a sanctioned person can be flagged. The firm then holds the payment while it checks details such as date of birth or address. Most false matches are cleared once the extra details are confirmed.
PEP screening
Firms also check whether a customer is a politically exposed person (PEP), such as a senior politician or their close family. Being a PEP is not a crime, but firms must apply extra checks.
Where SendPay fits
Anyone running a money platform needs screening in place. SendPay platforms are powered by licensed partners, and SendPay tells you in writing which licences apply to your platform before you pay.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.