What Is e-KYB? e-KYB and e-KYC Explained
You know about eKYC, but what about eKYB? Knowing who you do business with is a critical part of compliance. Find out what eKYB really is.
The Know Your Customer (KYC) process is a crucial part of the anti-money laundering compliance process. While KYC is for individuals, an extension of this is Know Your Business (KYB) which focuses on companies.
Similarly, as the digitalized KYC process is known as e-KYC, e-KYB is also conducted using digital means. As company information can be submitted, researched, and cross-checked online, e-KYB is becoming increasingly widespread due to regulatory requirements imposed by various jurisdictions around the world. As a business owner, you will also need to familiarize yourself with e-KYB.
Why e-KYB? What are the benefits of e-KYB?
The KYB process is part of the anti-money laundering (AML) and counter-terrorist financing (CFT) regime in place to thwart the illegitimate flow of money. Compared to KYC, KYB is a relatively recent requirement as authorities have realized that companies can also be used as a vehicle to move ill-gotten gains.
Thus, before conducting business with other companies, you need to comply with KYB regulations in order to protect your interests. You need to be aware of whether your revenue is being misappropriated by corrupt shareholders or business owners for illegal purposes.
Hence, to streamline the customer onboarding experience for companies, e-KYB was born. By digitalizing the sometimes-tedious process, your business can save on regulatory costs, avoid reputational damage, and enhance the B2B customer experience.
The e-KYB process explained
In order to accomplish its goal, e-KYB ascertains if the corporate enterprises that you deal with are legitimate businesses or shell companies. While there are legitimate uses for shell companies, a key part of e-KYB is to determine the beneficial ownership of the company, i.e. the person that ultimately benefits from the company’s purpose. By ‘lifting the corporate veil’, you can make absolutely sure that the entity you are dealing with is not involved in unlawful activities.
The e-KYB procedure starts with the submission of company registration documents, registered addresses, relevant licenses held, as well as names of managers and owners. The data is then cross-checked with official company registers, banks and financial institutions, data on politically exposed persons, and other sources to examine the company’s risk profile.
This way, the company’s identity can be verified, as well as the beneficial owner of the company. You can then determine if the company’s risk profile matches the intended nature of the business relationship.
Does my business need e-KYB?
If your business is involved in the finance sector, then you will have to undertake KYB as part of Bank Negara’s AML and CFT guidelines.
But even if you’re not involved in finance, KYB is also a part of sound business and risk management practice. By better understanding your customers, you can avoid fraud-related losses, or inadvertently taking part in a fraudulent scheme.
Using e-KYB solutions not only saves time but also reduces the risk of human error. The system is designed to be more efficient, accurate, and reliable, ensuring that the business verification process is carried out smoothly. By automating the KYB compliance process, businesses can ensure that they are meeting the necessary regulatory requirements and protecting their businesses from financial crimes.
How Tekkis can help in e-KYB
With Tekkis t-Verify solution, your business can verify a company’s identity securely, via an online platform that adheres to the highest standards in regulatory compliance.
Underpinned by the latest in AI, Tekkis t-Verify can:
- Recognize and verify company documents.
- Cross-check the submitted documents in real-time to various national and institutional databases.
The entire process can be done efficiently, reliably, and consistently, saving the business time while also ensuring a frictionless customer experience.
Start your e-KYB compliance journey with Tekkis today by getting in touch with us. Our friendly Customer Experience team is always ready to assist.
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