As financial crime compliance becomes increasingly complex, many banks continue to rely on outdated anti-money laundering (AML) systems, choosing to layer new technology over old rather than fully replace it. While augmentation once seemed like the safer route, especially during early cloud transitions, it now leaves institutions exposed to inefficiencies and compliance risks.
Napier AI, a provider of a next generation intelligent compliance platform, recently delved into why augmentation of legacy AML systems is not the answer.
One of the most common arguments against replacing legacy systems is their deep integration. But outdated sanctions screening tools simply can’t be adjusted to handle today’s regulatory pace. A modern risk-based AML approach requires highly configurable screening that legacy platforms can’t deliver.
Cost is another misconception. Augmented systems often duplicate functionality—resulting in duplicated licensing, API usage, and data costs. In contrast, NextGen AML platforms are lightweight, quick to implement, and significantly more cloud-efficient. They reduce unnecessary alerts and improve time-to-value.
Testing environments are also a sticking point. Legacy systems typically lack an integrated sandbox, forcing banks to rely on disconnected tools. This creates a delay between testing and production—introducing risk. A NextGen system with built-in testing allows teams to validate changes on live data, ensuring a smoother transition to production and better alignment with fast-changing regulations.
Ultimately, the case for ripping and replacing legacy AML technology is strong. Only a purpose-built, NextGen compliance system can deliver the adaptability, cost-efficiency, and risk reduction required in today’s financial environment.
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