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KYC Best Practices and FAQs

Phase 1 - Customer Onboarding

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Overview

Know your customer ("KYC") is a critical function to assess customer risk and legal requirements to comply with AML regulations and fiduciary responsibility. Effective KYC involves knowing a customer’s identity, their financial activities, and the risk they pose. KYC is comprised of three key phases:

  1. CIP (Customer Identification Program)
  2. CDD (Customer Due Diligence) - Understanding the identity and the location of your customer, while also gaining a good understanding of their expected activities. Any customer that is considered to pose higher risk can also trigger EDD (Enhanced Due Diligence) which would result in a more in depth review of the customer and potentially additional documentation to fully understand their risk profile.
  3. Ongoing Monitoring - Ongoing oversight of transactions and accounts based on thresholds developed to identify red flag triggers that would pose potential suspicious activity. Examples of these risks would be, but not limited to: Unusual transaction activity based on the customer's profile or historical activity; negative news or OFAC screening hits; accounts opened with no transaction activity and the funds withdrawn shortly after; deposits and withdraws from jurisdictions considered high risk due to lack of FATF AML controls framework. Suspicious investigations and ultimately SAR filings can be the end result of this monitoring and account closing.

KYC Onboarding Program Best Practices

  1. Know what IDs in your country are supported by our KYC vendor, Onfido.

    • Note how many sides are required to be uploaded per ID
    • If only one side is required, the back side of the ID to be uploaded in the Partner Dashboard / DriveHub can be a blank page.

  2. Ask the Partner Solutions Group which of the supported IDs result in the highest approval rate.

    • For example, in India, the ID with the highest approval rate is the Tax ID (PAN Card). In Ireland, it’s the Irish Passport.

  3. International Driver Licenses has the lowest approval rate because our KYC vendor only accepts specific Driving Licenses in various countries .

    • For example, in India, Onfido only supports three driving licenses: Delhi, Karnataka, and Maharashtra.

  4. Ensure the customer’s name on the ID matches exactly with the name on the account application.

    • The customer’s Last Name on the account application should only be one name, unless it is a hyphenated surname (for example, “Johnson-Smith”). See the Examples section below for more information.

  5. Ensure the customer is uploading a good quality image of the ID that takes up the entire frame for it to be clearly readable and identifiable. IDs uploaded that have poor photo quality (blurry or have a glare, a flash, or shade obscuring the image) and/or small photos of IDs are primary reasons why accounts are not approved.

  6. Do not allow customers to upload IDs that are not supported. Customers do this all the time, and it creates backlogs and increases the time for the account to be approved.

  7. Make sure customers upload the correct side of the ID. If only the front side of the ID is required, and the customer uploads the back, the new account will not be approved.

  8. Ensure the instructions on the app for account information and IDs are VERY clear. By following the Best Practices listed and clearly providing your customers these instructions at account opening, you will increase user experience and approval rate.

FAQs

Q: How do I know what the KYC Status is for a customer’s account application?
A: Search the customer’s name, email, or account number in the Partner Dashboard / Drivehub → Click on the Compliance tab → Under the KYC box, the Status field provides details about the KYC status → When you move your cursor over the “i” symbol next to “Status”, the statuses are listed In "KYC Status and User Status" in Step 4 KYC

Q: How many attempts do customers have to get their account approved?
A: For international customers - 6. After six failed attempts, the account will be closed.

Q: If a customer’s account is closed, but has money in the account, how does the customer get the money back?
A: The partner can submit a Jira or Zendesk ticket for the funds to be sent back to the customer’s funding account, or the customer can submit an email to our support team.

Q: If an account is in KYC_INFO_REQUIRED, what do I do?
A: Review the Status field in the Compliance tab of the Partner Dashboard / DriveHub which will provide you with the specific details of what information needs to be updated. If need be, contact your customer for confirmation of the information, and once you update the specified information, an automated review of the updated application will automatically trigger. Hopefully, the account will then be approved.

Q: If an account is in KYC_DOC_REQUIRED, what do I do?
A: Review the Status field in the Compliance tab of the Partner Dashboard / DriveHub which will provide you with the specific details of what was wrong with the uploaded ID. Your customer must then upload a new ID that will solve the problem identified, and once this ID is uploaded, an automated review of the updated application will automatically trigger. Hopefully, the account will then be approved.

Q: If I have questions on a specific account application, what do I do?
A: Submit a ticket to Jira or Zendesk ticket explaining the situation and your question, providing all necessary information.

Examples

Mismatch names

Remember that the name on the IDs must be identical to the name on the application (firstName & lastName)

Name on application that would be APPROVED

  • firstName: SRIRAM
  • lastName: MAMUNDI

Name on application that would be REJECTED

  • MAMUNDI SRIRAM
  • S MAMUNDI
  • SRIRAM M

Name on application that would be APPROVED

  • firstName: I
  • lastName: Deepa

Name on application that would be REJECTED

  • DEEPA I
  • ILANGO DEEPA
  • ILANGO D
  • I DEEPA DEEPA

Name on application that would be APPROVED

  • firstName: SITA MAHA LAKSHMI
  • lastName: RAMADUGULA

Name on application that would be REJECTED

  • firstName: SITA MAHA

  • lastName: LAKSHMI RAMADUGULA

  • firstName: SITA

  • lastName: MAHA LAKSHMI RAMADUGULA

For Passports: Last Name is the Surname.

For Indian Partners: For Aadhaar IDs and PAN Cards: The Last Name to input in the application is the name listed last on the customer’s ID. Do not input Father’s Name, S/O Name, etc., if it is not included in the customer’s name.

Updated 8 months ago