the importance of kyc and its limitless benefits
the importance of kyc and its limitless benefits

The Importance of KYC and Its Limitless Benefits For Budding Businesses


Do you actually KYC ‘Know Your Customer’?

As a business owner, it’s not only important to have concerns about making profits; it is also crucial to make pragmatic attempts to know who you are or intend having business relationships with. This entails recognizing and confirming the identity of your prospective customers. Knowing your customer, no matter what industry and field you are in, is the totally required first move to continual business growth.

KYC in simple terms is the means of identifying who your investors or customers are and their financial status, verifying the origin of their revenue (if they are genuine or not), and requiring detailed data from the clients. Having access to detailed information about your customers protects both factions in business negotiations and relationships. KYC serves an important purpose for providing superior service, preventing liability, and avoiding association with money laundering, and other types of fraud. Being decisive about who you can and should do business with has its implication on cost, time, and resource indication for businesses. This requires carrying out a customer due diligence which incorporates some of the following steps:

· Validating the identity and location of the potential customer

· obtaining a clear analysis of a customer’s business engagements.

· Deciding on the impending risks linked with the customer

· Accumulating and tracking information about a customer

· Effecting periodic due diligence assessments to determine if the existing risk category is still applicable

The importance of KYC to your business

The most progressive artificial intelligence technologies have totally refined and digitized onboarding processes, evading any type of friction and difficulty for the customer to connect with the remote contracting of products and services in an absolutely secure way. Let’s consider some ways KYC services can add value to your business:

1. KYC establishes Trust

KYC help build trust in business deals and give an organization awareness of the nature of a customer’s enterprise. In addition to that, they are a vital part of the onboarding process and can significantly improve the way services are rendered to customers and how they are managed over the course of the relationship. Implementing strict regulatory requirements under KYC connotes that your business is only involved in doing lawful business. This results in the building of trust in your company; not only by existing customers but also by prospective ones. In time, business growth is expected because customers trust you than other non-KYC compliant businesses

2. Improves Customer Experience

Recent technologies such as myidentitypay for online identity verification are critical because KYC adds friction to the onboarding process as customers undergo the paramount identity verification steps. Long wait times are costly for businesses and discouraging for customers who await swift and easy interactions. In fact, the leading cause of most businesses losing customers is because the onboarding process sometimes simply takes too long and can be tedious. Knowing your customers better helps you to serve them better. The fact-finding process in myidentitypay’s KYC services help businesses gather useful data about customer’s profiles such as their ages, employment status or purchasing power. These data can then be employed by organizations to offer customized solutions to clients to better serve their needs. As a result, good customer relationships are forged which in term aids in future booming business deals.

3. Promotes Risk Management

Being informed about your client’s source of income, weighing their potency of investing in your product, and obtaining their complete financial stance and background are critical aspects of KYC requirements. If a business or issuer complies with KYC policies, they will reduce the financial risks of their business dealings with certain clients. KYC enables checks that can also be imperative to risk management procedure to avoid engagement in business relationships with potential clients who have been previously involved with activities that are illegal.

In clearer terms, KYC helps you to discover the customers doing business with you with unethical methods, so you can quickly decline the business engagement which will result in business legitimacy, that is, doing business trustworthily. This translates to a good business reputation and potentially more clientele.

4. Aids Transaction Monitoring

Checking your customer’s background once is not enough for establishing long-term trust, organizations must develop simple, auditable processes to maintain ongoing checks. Continuous monitoring requires a seasonal review of all information regarding clients or customers, this might include overseeing financial transactions and accounts with a focus on thresholds determined during the risk assessment process. KYC looks for certain factors during monitoring such as unusual spikes in activities, media mentions pointing to fraud or illegal undertakings, unexpected activities in other countries, the inclusion of the customer on sanction lists, and others. In these cases, a Suspicious Transaction Report may be created aiding the company’s ability to determine a customer’s risk level correctly.

Myidentitypay KYC services give you as a merchant the opportunity to verify customers without the stress and within seconds. Let’s show you how it works — click on myidentitypay to learn more.

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