Beyond Hawala: How Terrorists Fund Themselves in 2025

The Financial Action Task Force (FATF) released its most comprehensive look at terrorist financing (TF) risk since 2015, drawing on more than ten years of insights.

Here’s what stood out.

Old Tactics, New Twists

Terrorists haven’t abandoned the classics:
💰 Cash, hawala, and unlicensed MVTS remain core channels.
🏦 Abuse of banks, prepaid cards, and shell entities continues, often with weak UBO transparency.
🌐 Non-profit organisation misuse is still a concern, with both sham and legitimate charities being exploited for fundraising or logistics.

But here’s the twist. These are being layered with digital tools:

• Blockchain-based adaptations of hawala

• Mobile money and online payment platforms

• Crowdfunding campaigns via social media

• Even in-game payments on online gaming platforms

To Make Things Worse

Terrorist financing and organised crime are blurring fast.

• Natural resources (oil, gold, timber, wildlife) are funding conflict.

• Human trafficking, extortion, kidnapping for ransom are revenue streams.

• Drug and arms trafficking remain reliable cross-border earners.

This overlap makes typology-based detection harder because the same red flags could point to ML, TF, or both.

FATF’s Call to Action

✅ Tackle TF as a transnational problem, not just local.
✅ Strengthen VASPs, MVTS, and legal entity oversight: gaps here are glaring.
✅ Expand public-private partnerships to cover social media and fintech platforms.
✅ Safeguard humanitarian aid flows.

And Here is What Can We Do to Help

For compliance teams, the lesson is simple:

• Don’t just monitor accounts. Put things into perspective: monitor behaviours, geographies, and new tech use-cases.

• Think cross-crime convergence. If it looks like fraud, trafficking, or smuggling… it might also be TF.

📖 Full FATF report: Comprehensive Update on TF Risks 2025

Thanks for reading.

Happy to hear your thoughts on the matter. Let’s discuss!

Alexey