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Acams CKYCA Exam - Topic 5 Question 16 Discussion

A bank's business team has developed a new strategy, which includes the introduction of prepaid cards as a new high-risk product offering. The compliance team has proposed to impose a monetary limit on each prepaid card and limit the offering to the existing customers of the bank only. Which best describes the risk impact of the controls proposed by the compliance team?
B) Residual risk will decrease.
A) Inherent risk will increase
C) Inherent risk will decrease.
D) Residual risk will increase.

Acams CKYCA Exam - Topic 5 Question 16 Discussion

Actual exam question for Acams's CKYCA exam
Question #: 16
Topic #: 5
[All CKYCA Questions]

A bank's business team has developed a new strategy, which includes the introduction of prepaid cards as a new high-risk product offering. The compliance team has proposed to impose a monetary limit on each prepaid card and limit the offering to the existing customers of the bank only. Which best describes the risk impact of the controls proposed by the compliance team?

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Suggested Answer: B

Inherent risk is the natural risk before controls are applied. The compliance team's measures (monetary limits and restricting to existing customers) reduce the exposure to misuse, thereby lowering the residual risk - the risk that remains after controls are implemented.


by Dyan at Jun 19, 2026, 01:30 PM

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