Know Your Customer [KYC]
KYC is a set of principles for identifying and verifying the identity of banking clients to adhere to anti-money laundering regulations, but also to ensures that the bank has detailed information on the clients’ risk tolerance, investment knowledge and financial standing. The legal process of a business identifying and verifying the identity of its clients. KYC requirements vary from jurisdiction to jurisdiction.
Know Your Customer (KYC) guidelines in financial services require that professionals make an effort to verify the identity, suitability, and risks involved with maintaining a business relationship. The procedures fit within the broader scope of a bank's anti-money laundering (AML) policy. KYC processes are also employed by companies of all sizes for the purpose of ensuring their proposed customers, agents, consultants, or distributors are anti-bribery compliant, and are actually who they claim to be. Banks, insurers, export creditors, and other financial institutions are increasingly demanding that customers provide detailed due diligence information. Initially, these regulations were imposed only on the financial institutions but now the non-financial industry, fintech, virtual assets dealers, and even non-profit organizations are liable to oblige.
