International Monetary Fund publishes guidance on applying FATF AML/CFT standards to retail central bank digital currencies

The International Monetary Fund published a Fintech Note on the financial integrity implications of retail central bank digital currencies (rCBDCs), setting out how prevailing international anti-money laundering and combating the financing of terrorism (AML/CFT) standards should be applied in an rCBDC setting. The note identifies rCBDC design features that can affect money laundering and terrorism financing risks and provides considerations to inform both policy choices before launch and practical application of AML/CFT measures once an rCBDC is introduced. The analysis maps AML/CFT implications across key rCBDC design dimensions including token-based versus account-based models, direct versus intermediated distribution, centralized versus decentralized infrastructure, permissioned versus permissionless access, domestic versus cross-border use, offline functionality, and privacy-preserving features. It highlights that the Financial Action Task Force (FATF) Standards apply to CBDCs similarly to other forms of fiat currency, but flags areas where implementation may be more challenging or raise interpretive questions, including risk assessment and governance of risk mitigation, customer due diligence and the prohibition on anonymous accounts in tiered wallet models, reliance and outsourcing arrangements, payment transparency requirements for transfers, targeted financial sanctions in low-identification or offline contexts, record-keeping responsibilities where the central bank holds the ledger, and transaction monitoring and suspicious transaction reporting where transactions may not be visible in real time. The note also outlines supervisory and enforcement considerations, particularly where a direct model could place a central bank in an AML/CFT-obliged role and raise conflicts-of-interest or central bank independence issues, and it describes potential opportunities for improved monitoring and “compliance-by-design” in unified ledger environments while noting that such approaches are untested and not a substitute for effective AML/CFT frameworks.