These global standards, including AML 4 and 5 guidelines and “KYC” safeguards for customer identification, are gradually being implemented in national legislations. It is therefore crucial for banks to devote sufficient time to assessing bank account opening products.
What role does the KYC (Know-Your-Customer) protocol play in opening a bank account?
Banks use KYC processes to verify the authenticity of potential customers and to analyze and monitor potential risks. These customer onboarding techniques help in the detection and identification of money laundering, terrorist financing, and other types of illegal activities.
In addition, KYC includes identification, face and document verification, utility bills for address verification, and biometric validation. Banks must comply with KYC and anti-money laundering requirements to prevent fraud. In addition, banks are responsible for ensuring compliance with KYC standards.