Banks need to know who their clients are. They need to make sure that the person who’s opening the account is the same one in the documents or files submitted. That’s where KYC in banking comes in. KYC or Know Your Customer—or sometimes Know Your Client—is a process that identifies and verifies the clients opening the accounts. They also do checks over time to make sure that the person is still the same.
What does KYC process involve?
The KYC process involves ID card verification and face verification. It also includes document verification. The most common of these files include bills which often serve as proof of the client’s address. Biometric verification is also included.
Why does the KYC process matter?
The process is a crucial step as it confirms the identity of your clients. That helps your team assess and monitor risks. The process also prevents money laundering and terrorism financing as the process helps identify these schemes. It also flags other illegal corruption problems.
What is KYC compliance?
If you manage a bank, then you know that it must comply with KYC regulations along with anti-money laundering regulations. KYC compliance measures are in place to protect against fraud. KYC compliance, then, is the responsibility of banks. If your firm fails, then you’ll face heavy penalties.
How do you choose a program?
Look for software that comes with features that provide the support your bank needs. How will those features speed up your processes? How will it enhance your security protocols? How will it make your life easier? Also, don’t forget to check for ease of use. A system that bogs down your operations isn’t going to make your employees eager to adapt to the said program. Consider ease of use when you pick a KYC solution.