Protect Your Business With KYC/KYB Verification
Help prevent financial crime by verifying the customers and businesses you work with.
View Kotapay KYC Requirements (PDF)
What is KYC/KYB?
Know Your Customer (KYC) and Know Your Business (KYB) are core compliance processes used to confirm identity, understand risk, and help prevent money laundering, fraud, and other financial crimes.
- KYC verifies an individual
- KYB verifies a business entity
Together, they support a strong, risk-based compliance program.
Who Does KYC/KYB Impact?
Any financial institution that allows customers to open and maintain accounts must follow KYC/KYB requirements – and those expectations extend to the organizations they partner with, including processors and originators.
What Kotapay Requires During Client Onboarding
As part of Kotapay’s commitment to compliance, all processors must maintain KYC/KYB procedures that meet Kotapay standards.
Required onboarding expectations include:
- Identify and verify the company and its beneficial owners
- Perform due diligence on the business model, services, and submitted information (including background checks such as ownership, media presence, location, and industry sector)
- Assess risk factors associated with the business
- Keep information up to date and review activity regularly, including when changes occur
For full requirements and detailed guidance, view the Kotapay KYC Requirements document.
Core Components of KYC/KYB (Quick Definitions)
Customer Identification Program (CIP)
The initial step: collect and verify basic identifying information to confirm the customer or business is who they claim to be.
Common examples:
- Legal name
- Date of birth (individuals)
- Address
- Identification number (SSN/EIN/TIN, as applicable)
Customer Due Diligence (CDD)
Follows CIP: builds an understanding of risk by reviewing purpose, expected activity, and source of funds including identifying beneficial owners.
Enhanced Due Diligence (EDD)
A deeper review for higher-risk customers or scenarios.
In short:
- CIP confirms who the customer is
- CDD/EDD helps determine the level of risk
Determining Whether a Customer Is a Good Fit for ACH
Not every customer is a good fit for ACH processing.
Consider:
- Is the business financially stable? (For newer entities, request financials or tax returns if needed.
- Does the client have an established, positive history with your organization?
- What processes are in place to ensure sufficient funds for payroll or payment activity?
Need Help?
If you have questions about KYC/KYB expectations or a specific onboarding scenario, our team is here to help.
Contact Kotapay: (800) 378-3328
