June 18, 2018

KYC for Businesses – A Deep Dive

While banks and financial institutions have a monetary incentive to add as many new companies and individuals as possible to their banking system, they face many challenges in executing the onboarding process for new customers. Over the past few years, the Know Your Customer (KYC) and Know Your Business (KYB) verification processes for initiating clients have evolved significantly, as functions of the ever-increasing complexities of the business landscape and escalated regulatory scrutiny. Balancing regulations for AML/CFT with attempting to create an efficient and seamless onboarding process for new customers to increase profits has proven to be increasingly difficult for banks internationally. In an attempt to mitigate the impacts of money laundering, market manipulation, and terrorist financing, governments have bolstered their compliance requirements. Regulatory changes like Europe’s fourth Anti-Money Laundering Directive (MLD4) and Financial Crimes Enforcement Network Customer Due Diligence Rule (FinCEN CDD Rule) have forced banks to choose between efficiency…

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