KYC system software is similar to the well-known Know Your Business (KYB). KYB is the process of knowing your business, whereas KYC is referred to as knowing your customers. c Businesses are required to perform the KYC process via the KYC system software for their customers to get a clear picture of their credibility. This is not only an identity check, but it also measures the authenticity of business-to-customer affiliation on both sides. The identities of customers or clients are verified by scrolling through public registers and smart AML systems. Verifying customers is the utmost priority of all B2C industries.
Significance of KYC Process in the Corporate sector
KYC is a subset of the broader category known as “Customer Due Diligence.” In an effort to stop the financing of terrorism and international money laundering, regulators have become more active in these areas. Businesses must confirm each customer’s identity because, as a business, they are required to abide by a mountain of regulations. This is possible with effective KYC software.
How does it work?
KYC processes vary by country and by industry. The KYC requirements for financial services are typically stricter than those for telecommunications companies, which achieve more flexible policies. However, customers should always share verifiable information.
Typical specifications include:
- Customer full name
In addition, prospective clients must show that they are the real beneficial owner and that they are not politically exposed people. The company typically conducts AML sanction screenings to verify both.
Financial institutions must pay a high price to complete the KYC process for all customers and entities. This is disclosed by the client, who must comply with each request for KYC process data, or else their transactions could be delayed. A centralized online KYC registry has recently been proposed as a potential solution to help financial institutions and their clients with many of these issues. Some registers enable the standardized exchange of nearly all KYC data and significantly lighten the KYC processing administrative burden.
The Applied KYC Process follows high-tech integrations
Maximum Coverage of Identity Documents
As of 2019, there are more than 150 different passport types and roughly 100 different types of national identification. Then there are older versions of passports and other forms of identification that are still commonly used. The ability to recognize the most recent iterations of international IDs is therefore not sufficient for your KYC process. Businesses should instead make use of historical databases that can also verify legacy passports and identification documents.
KYC Process Screenings
Due to the widespread use of the internet, people and companies located anywhere in the world can now do business with one another. In order to further their own agendas, malicious actors are constantly attempting to abuse services designed to assist people.
Companie’s KYC process must be able to recognize terrorists and other criminals from all over the world. The KYC providers must continuously keep an eye on things in order to accomplish this.
For corporate clients, the KYC process complies with AML
Many of the outdated B2C acronyms are no longer relevant. The truth is that a lot of businesses have to work with both retail and corporate clients. Both have distinct KYC and AML requirements, which should not be ignored. As a result, it is critical that the KYC process examines customer backgrounds around the globe in order to confirm the legitimacy of any customer portfolio. The first and most crucial step in the corporate KYC process is gathering and verifying information about business owners.
Whether your company is planning on onboarding corporate clients or even raising venture capital, make sure that your KYC process is able to handle non-retail clients.
KYC process needs to be scalable
Be sure to design a KYC process steps that can handle millions of applicants. Always inquire how many applications there are if you are visiting a KYC service provider. Ask the salesperson, How many applications the software has processed so far whenever you visit a KYC service provider. Make sure to look for alternatives if the number seems low to you.
Last but not least, businesses gain a lot from KYC’s verified business solutions. Companies with access to enhanced due diligence KYC processes may obtain all the data they require, including criminal histories, registered records, ultimate customer identification, etc., in a single, easy-to-use window. In the end, company B2C verification enables companies to sign contracts with customers with confidence. By automating and continuously retrieving data, the process reduces risk in already-existing collaborations. You need a reliable KYC process verification service in order to protect your business relationships, fulfill your AML obligations, increase B2C conversion rates, and lower operating costs.