TRISA’s Travel Rules Solution Welcomes Interaction With PayID

Having secure, speed, and cost-effective cross-border transactions is paramount for financial institutions as these factors influence the satisfaction of customers. This can be made possible by the interaction of TRISA’s Travel Rules Solution with PayID. The integration of both platforms will help VASPs and businesses comply with the Travel Rule, a regulation designed to help reduce financial crimes and money laundering.

That said, our article sheds light on the interaction of TRISA’s Travel Rules Solution and PayID, the challenges it seeks to address, and its benefits.

A Background Overview About TRISA

Travel Rule Information Sharing Architecture (TRISA) is an open-source, decentralized solution developed by CipherTrace. It was designed to combat the problems financial institutions and VASPs face in complying with an international regulation known as the “Travel Rule.” TRISA uses a credible Certified Authority model to verify the legitimacy and identity of VASPs, and it’s designed to be interactive with platforms like PayID.

On the other hand, the Travel Rule was established by the Financial Action Task Force (FATF), which is an international organization responsible for creating and promoting laws and policies to fight issues in the FinTech industry. These issues include terrorist financing and money laundering.

Due to the increase of new technology innovations like Peer-2-Peer and Crypto payments, which cause an increase in financial crimes, FATF saw it fit to revise the Travel Rule. This was done in June 2019.

According to the revised Travel Rule, financial institutions are required to share information with other involved entities about cross-border transactions. VASPs are also mandated to share data about the sender and receiver of crypto transactions exceeding a specific threshold. Some of the important changes in the Travel Rule include the following:

  • The shared information now includes the transaction’s date, time, and purpose.
  • All types of transactions are included in the Travel Rule regardless of the amount of money being transacted.
  • All financial institutions, including Virtual Assets Service Providers (VASPs), are bound by the Travel Rule.
  • There’s a guide from the Financial Action Task Force regarding the implementation of the Travel Rule and the use of tech to enable the sharing of transaction information.

The shared data should entail the sender’s, recipient’s, and the amount details of any transaction that exceeds the set threshold. The information must be accurate as it is shared with not only the involved financial institutions but also with law regulators and enforcement. The sharing of this information is what helps verify the legitimacy of the transaction or the parties involved in the transaction.

Interaction with PayID

In order to simplify international transactions with TRISA, another link is needed. This is where PayID comes in. It serves as a link between payment platforms. In addition, it is compatible with fiat and cryptocurrencies. This means that PayID can be integrated with TRISA to make it easier for businesses and VASPs to comply with the Travel Regulations.

Additionally, PayID simplifies the process of transferring money. It allows users to send and receive money using identifiers such as email addresses or phone numbers. This eliminates the need to enter account numbers for bank transfers.

To help you understand how this interaction works let’s take a real-life example. Imagine a situation where a client in Canada needs to send money to their supplier in China. Normally, this process would take several business days due to the complexities of international wire transfers. However, thanks to the integration of TRISA and PayID the client can now initiate a transaction using their supplier’s PayID (either an email address or phone number). This integrated system will automatically share all the transaction details with the financial institutions involved ensuring that security, speed, convenience, and efficiency are maintained throughout the entire process.

NOTE! This system should not be mistaken for the finance platform PayID. This platform is used by Australian residents for domestic payments, including online shopping, PayID (BPay) pokies, and utility bills.

Benefits of the Interaction of TRISA’s Travel Rule Solution and PayID

1. The Interaction Enhances Security

TRISA’s Travel Rules Solution provides a transparent and safe way for businesses to share information about cross-border transactions. This helps reduce security issues like fraudulent transactions and data breaches. When integrated with PayID’s user-friendly identification system, security is strengthened. By using the integrated system, the transaction details are safely shared between the involved financial institutions, which helps verify the identity of the sender and the recipient. This helps reduce the risk of fraudulent activities.

2. Compliance with the Travel Rule is Simplified

Complying with the Travel Rule has become much simpler allowing financial institutions and VASPs to avoid the process and potential high fees associated with non-compliance. Now institutions can conveniently access the transaction details of all parties making it effortless to securely confirm and verify client information, for cross-border transactions.

 A notable point to consider is that adhering to the Travel Rule seems to be one of the major obstacles for VASPs and businesses that operate in multiple jurisdictions. This is because it can be difficult for businesses to share information with businesses they may have no prior association or relationship with, all while ensuring the security and privacy of their customers.

3. Improved Speed and Increase in Efficiency

Typically, when it comes to border transactions there is often a delay of several business days for processing along with potential charges. However, the integration of TRISA and PayID changes this scenario and even has an advantage over Neosurf.

Based on research conducted by the Bank for International Settlements, combining TRISA’s Travel Rule and PayID has the potential to decrease cross-border payment expenses by a minimum of 30% and enhance transaction speed by 50%.

 

Thus, the collaboration between TRISA and PayID enables users to comply with the Travel Rule on the one hand and to maintain their privacy on the other hand.

An added benefit is that there is a direct and easy way to make international payments without the time-consuming entry of all bank details.

Andy Higgs
Andy Higgs

I know what it's like to go from being a crazy backpacker without a care in the world, via being a vaguely sensible parent to being an adventurer once more. In other words, evolving into a Grown-up Traveller.

Like everyone else, I love to travel, have visited a lot of countries and all that but my big thing is Africa.

I also own and run The Grown-up Travel Company as a travel designer creating personalised African itineraries for experienced adventurers

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