The compliance challenge in payments

Payment service providers sit at the intersection of global financial flows. Every transaction — whether a cross-border wire, a merchant settlement, or a consumer P2P transfer — carries inherent counterparty risk. Regulators expect PSPs to screen all parties in real time, apply appropriate due diligence, and maintain complete audit trails. Yet the payment industry moves at a pace that traditional compliance tooling was never designed to match.

Batch-processing AML checks that run overnight are no longer acceptable when instant payments settle in seconds. Manual review queues that balloon to thousands of cases are operationally unsustainable. And rule-based systems that flag 30–40% of transactions as false positives drain the capacity of compliance teams who should be focused on genuine risk.

Payment processors face a dual mandate: move money faster than ever, while maintaining stricter AML controls than ever. The only viable solution is automation that operates at transaction speed.

What's covered

Klarix addresses the full compliance lifecycle for payment businesses — from first merchant application to ongoing transaction surveillance:
 

  • Merchant onboarding KYB/KYC — verify ultimate beneficial owners, legal entities, and authorised signatories across 190+ countries using document OCR and biometric checks.
  • Real-time sanctions screening — OFAC, EU, UN, HM Treasury, and 1,490+ regional watchlists checked on every payment and counterparty event, updated continuously.
  • Transaction monitoring — ML-driven engine detects structuring, round-tripping, velocity abuse, and payment typologies specific to acquiring and money movement.
  • PSD2 & 6AMLD alignment — built-in support for EU regulatory requirements, including strong customer authentication data enrichment and DORA-compatible audit logging.
  • SAR generation & reporting — pre-populated suspicious activity reports drawn from case data, exportable directly to FIU-compatible formats with a full evidence bundle.

Reducing false positives without increasing risk

The most common complaint from PSP compliance teams is the volume of false-positive alerts generated by legacy rule engines. Klarix's risk scoring model uses a combination of entity resolution, contextual matching, and continuous ML calibration to reduce false-positive rates by up to 60% compared to rule-only systems. This means fewer manual reviews, faster payment processing, and a compliance team that can focus on cases that genuinely require human judgment.

Risk scores are dynamic — they update as new data arrives, rather than remaining static from onboarding. A merchant who onboarded cleanly two years ago will have their score recalibrated in real time if their transaction patterns change, if a director appears on a new watchlist, or if adverse media coverage emerges. This is the difference between point-in-time compliance and true continuous surveillance.

Integration and deployment

Klarix is designed for technical teams. Our REST API is fully documented with interactive examples, Postman collections, and SDKs for Node.js, Python, Java, and Go. Typical integration takes between three and five days for a standard payment flow; more complex multi-entity or multi-rail setups are supported with dedicated implementation support at no additional cost for enterprise plans.

We operate on a 99.99% uptime SLA across redundant EU infrastructure, with automatic failover across three availability zones. Compliance operations are too critical to tolerate downtime — and we treat uptime as a regulatory obligation, not just a commercial promise.