97% of Leading Financial Institutions Believe Industry Collaboration is Essential for 2025, Finds GSS

Global Screening Services (GSS), a leading RegTech pioneer, has published its 2024/2025 Sanctions Survey, offering an in-depth analysis of the shifting sanctions landscape through insights from top global financial institutions.

Developed in consultation with GSS’ Advisory Board Members – representing experts from over 35 leading international financial institutions (FIs) – the survey identified the complexity of sanctions compliance as the most pressing challenge facing financial institutions today.

Sanctions requirements have become increasingly complex, extensive, and frequent, with a substantial amount of annual cross-border transactions undergoing active screening. However, the sheer volume of sanctions activity remains a key concern, with the volume of updates ranked the third-highest challenge (3.8/5), closely followed by the frequency of sanctions (3.6/5).

Geopolitical Tensions and risks

The survey also explored which countries present the greatest sanctions risks for financial institutions. Unsurprisingly, Russia was rated as the highest risk (4.7/5), reflecting both domestic and international implications of Russian sanctions. Iran followed at 4/5, while risks related to China (3.5/5), Syria (3.3/5), and North Korea (3.1/5) were also flagged.

Beyond geographic risks, hidden relationships (4.4/5) and issues associated with Money Services Businesses (MSBs) (4.4/5) also ranked as significant concerns, underscoring the challenges institutions face in detecting intermediaries and complex corporate structures used to evade sanctions.

Leveraging technology

Technology, particularly AI and machine learning (ML), is increasingly pivotal in helping financial institutions manage sanctions compliance. The survey revealed that 100% of respondents believe AI/ML will play a key role in future sanctions screening.

Sanctions screening remains an essential control, but it generates significant costs and friction, with alert rates of 5–15% and over 99.6% of sanctions alerts being false positives. The value of AI lies in its ability to process vast amounts of data at speed, flagging potential issues for compliance teams to investigate while significantly reducing false positives.

The majority of respondents (97%) were enthusiastic about AI/ML’s potential to transform sanctions screening, while 45% have adopted or plan to adopt cloud-based solutions to enhance compliance processes. Additionally, 17% are exploring blockchain technology for its potential to improve traceability and sanctions compliance.

Data quality in sanctions screening

A notable finding from the survey is that data quality remains a critical challenge and is the second-highest issue (4/5). Accurate, high-quality data is fundamental to effective compliance; without it, institutions face the dual risk of false positives and missed violations.

The finance industry’s move toward ISO 20022 adoption by November 2025 is a crucial step in improving data formatting and structure, enabling institutions to handle vast amounts of data more efficiently. Unstructured data has been a significant contributor to false positives, and this transition promises to streamline sanctions screening processes.

Tom Scampion, CEO and Co-founder of GSS, said: “Sanctions compliance is more demanding than ever, with financial institutions facing a perfect storm of complexity, volume, and risk. Yet, what’s clear from our survey is that the industry isn’t standing still. With 97% of respondents agreeing that collaboration is essential, financial institutions are utilising shared expertise alongside technologies like AI and cloud solutions to tackle these challenges head-on.

“What’s really encouraging is seeing how financial institutions are adapting. Whether it’s improving data quality or gearing up for regulations like ISO 20022, they’re setting a higher standard for how compliance can work smarter in a more complex environment.”