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Know your business process is the same as KYC processes but there is only a minor difference between the two. KYC processes directly focus on the verification of customers, whereas in KYB businesses looking to close potential partnerships with other businesses are identified and verified, so it’s more like a B2B verification.
KYB or KYC checks, both are important when the businesses involve monetary transactions. Know your business or KYB keeps businesses secure from any kind of involvement in money laundering activities. Know your business helps companies ensure that the clients they are dealing with are reliable and trustworthy. It follows the global Anti-money laundering and
KYC standards in order to verify the organizations undergoing potential partnerships with others.
What is KYB?
Know Your Business KYB checks are a business due diligence process carried out to prevent money laundering activities or ensure the actual physical presence of companies.
Knowing your business checks gives other companies a chance to identify businesses and any involvement with illegal activities before concluding the business. It ensures that the business you are dealing with is legal and not shell companies for running money laundering activities.
The Importance of Business Checks
A lot of automated business verification solutions are available in the market. Most of these are based on the applications of Artificial intelligence and machine learning. They not only verify businesses as a whole but also verify the individuals associated with the company such as the key stakeholders, shareholders, board of directors, and ultimate beneficial owners.
Their background history is thoroughly screened against government-issued sanction lists, black-lists, financial databases, and PEPs to check their involvement in money laundering or any other financial crimes, proper risk assessment profiling is carried out to validate the authenticity of global corporate entities.
Know your business checks are increasingly helping the financial institutions to trace the involvement of businesses in the illegal flow of money. Moreover, businesses are becoming more vigilant against other business entities that are looking for a partnership, whatsoever.
Know Your Business Checks are Eliminating B2B Frauds
Corporate fraud drastically increased during the global Pandemic. This not only causes disruptions in the market but gives illegal fake businesses a chance to carry on with their activities. Thus, performing business and document verification using automated solutions is on the rise and it is a strong step for preventing B2B/ corporate fraud.
Manual KYC and KYB processes are particularly slow and full of human errors and red-tapism. Sometimes third-party KYB service providers are hard to trust. But Artificial Intelligence (AI) based identity verification solutions verify business within minutes, seconds even. With Optical character recognition technology and global services, business verification is performed in real-time on the spot.
All financial institutions are required to perform the Know your business check. They must verify their partners spread across the globe for seamless and frictionless onboarding. Know your business checks help companies comply with anti-money laundering regulations, especially the financial sector since failure to comply can result in heavy non-compliance penalties that may take years to settle.
Traditional versus Digital KYB
The traditional know your business KYB approaches and methods includes a large volume of databases of companies and their legal owners. Although the information available is extensive but manually searching through all the entity databases is cumbersome. Since a lot of paperwork is involved, no one can tell whether the information available is accurate or not.
The chances are data available may be outdated making manual methods non-compliant with AML and KYC altogether. Whereas on the other hand, digital business verification solutions can perform business verification in real-time, all the data is easily accessible and accurate to date.
To expedite your Know your business KYB processes, a solution developed using artificial intelligence, machine learning, and optical character recognition is the right choice. Since it not only accelerates the company’s onboarding cycle but also extracts all the relevant information needed to complete the verification of the company and beneficial owners instantly.
To expedite Know your business KYB processes, a solution developed using AI, ML and optical character recognition (OCR) is the right choice.