What KYC involves
In the US, KYC rests on two rules. The customer identification program (CIP) requires collecting a name, address, identification number and, for individuals, a date of birth, and verifying identity through risk-based procedures. Customer due diligence (CDD) adds the account's purpose, beneficial owners and ongoing monitoring, with enhanced due diligence for higher-risk customers.
KYC for businesses
For a business customer the checks are often called know your business (KYB). The institution reviews formation documents, confirms good standing and identifies the people who own or control the business, who each need their own identity checks.
Where the work is
Automated identity verification clears most individual applicants quickly, so manual work concentrates in exceptions such as mismatched names, hard-to-read documents and layered business ownership. Each needs someone to resolve the discrepancy and record why, and the queue grows with every new customer.
Where automation helps
Automation helps most with exceptions, comparing the applicant's documents with the application and verification results and setting out each discrepancy, with its evidence, for an analyst. The decision to open or decline stays with a person, and every step is recorded for the examiner.