Are you making sure that you are running thorough background checks with your customers? From money laundering to identity theft, you need to be careful when building relationships with customers.
Whether it involves financial transactions or any other processes that require identity verification, you can count on KYC providers to help build strong relationships with trusted customers and zero tolerance to untrustworthy individuals. But what is KYC, and what industries benefit from such a process?
What is KYC?
Table of Contents
KYC or Know Your Customer is a procedure that assesses customer risk. It is a process that identifies the clients’ identity to ensure that you will not be a victim of money laundering or any other fraudulent activities regarding payments. It is a crucial step when building relationships with your clients. But what kind of industries make use of such a complicated process?
Financial Institutions
Banks and other financial institutions are at the forefront of KYC because banks deal with money. Simply opening an account with the bank already requires verified identification to ensure that clients are who they say they are when depositing money to their bank accounts.
E-Commerce
Anything involving financial transactions requires verification to establish trusting relationships with clients. So, if you are in the business of e-commerce and you handle online transactions, of course, you would want to only do business with trusted consumers who will not even think of scamming you for purchases.
Education
Educational institutions have also been requiring KYC identification nowadays. Examinations, for instance, are an opportunity for individuals to pay someone else to take the tests for them. So there is a need for an advanced type of ID verification in the education industry.
Gaming
The gaming industry also requires a robust identity verification process to prevent individuals from making fraudulent financial transactions. In-game purchases have been the driving force of most games, whether online or console, so it would be a big risk to the company to not verify their customers when making accounts.
Government
The government needs a strict identification process to ensure that only trustworthy individuals have access to government documents. On top of that, government officials also work with government funds, and the anti-money laundering law is in place for all government bodies to comply with.
Real Estate
Real estate is an industry that relies so much on KYC procedures to find clients who will be able to meet the demands of the properties they purchase. The mortgage itself should only be offered to verified individuals who have a good standing with their financial institutions.
Recruitment
Hiring employees also require a thorough background check of each applicant. It would be a disaster for the recruitment agency to send staff who are not trustworthy and have a problematic track record with other employers. By running KYC procedures, any applications will be verified thoroughly.
Telecommunications
Identity verification is also essential to telecommunication industries because the risk of fraudulent activities is high. Anyone using SIM cards can get hacked, and identity theft is a prevalent concern many individuals have regarding their mobile phones. Telecommunication companies need to place security measures such as KYC to reduce risk.
These are the industries that tend to use KYC procedures to ensure the safety and security of their businesses. If your company is a part of these industries and you require a secure way to identify and verify your customers, you should get a hold of KYC providers. You can count on the process to prevent untrustworthy individuals from breaking into the system.
