KYC (Know Your Client)

KYC stands for Know Your Customer/Client and is a bank procedure that identifies and validates a client’s identity. The process can typically be found during the opening of an account or over regular intervals over time. Put simply, it’s a way to ensure banks know that you are who you say you are. 

The KYC regulation stems from financial security as a frontline approach to help mitigate and pinpoint terrorism financing, corruptive schemes, and money laundering activities during client onboarding. KYC requirements typically include providing the following: 

• ID Card Verification
• Facial Verification
• Document Verification (e.g., proof of address via utility bills)
• Biometric Verification (i.e., fingerprints) 

For corporate companies, banks will typically request the following from the company’s employees, shareholders and board members: 

• Social Security Numbers 
• Copies of Photo ID 
• Passports 

Banks in the UK must strictly adhere to KYC regulations. Failure to do so may result in hefty penalties that can cost them millions, depending on the severity of the regulation breach. Money laundering has been a major thorn in financial security, and KYC regulation is helping combat this.