Summary

KYC means Know Your Customer and is a standard due diligence process used by financial institutions and other financial services companies to assess and monitor customer risk and verify a customer's identity during the onboarding process. Onboarding processes help prevent and identify money laundering, terrorism financing, and other illegal corruption schemes. KYC process includes ID card verification, face verification, document verification such as utility bills as proof of address, and biometric verification. Banks must comply with KYC regulations and anti-money laundering regulations to limit fraud. KYC compliance responsibility rests with the banks.

The Know Your Client or Know Your Customer ensures investment advisors know detailed information about their clients' risk tolerance, investment knowledge, and financial position. KYC protects both clients and investment advisors. Clients are protected by having their investment advisor know what investments best suit their personal situations. Investment advisors are protected by knowing what they can and cannot include in their client's portfolio. KYC compliance typically involves requirements and policies such as risk management, customer acceptance policies, and transaction monitoring.

See below for some Regulations for KYC.

Use case 1

Consumer requests a service from a Financial Institution

Triggering event	Consumer’s request for Financial Service, e.g. opening a Bank Account
Actors	Consumer, Financial Services employee
Preconditions	Consumer has some information on what is required to open a bank account
Post conditions	Consumer’s request is accepted
Scenario	The request could be in person at the bank
Alternate scenario	The request could be online using the web or mobile
Related use case	The Financial Institution reaches out to the consumer with marketing material to open a bank account with some attractive offers like no fee, low rates etc.
Notes

Use case 2

The Financial Institution requests KYC documents from the user. (During implementation this could be an Epic (collection of related user stories) with a User Story for each type of document/s verified)

Triggering event	Financial Institution requests KYC documents from consumer
Actors	Personnel at Financial Institution, Consumer
Preconditions	Financial Institution receives request from Consumer
Post conditions	Document either verified or verification declined if standards were not met Verification process include risk assessment against global sanctions lists Ongoing monitoring and record keeping
Scenario	Verification of documents could be in person at the Financial Institution
Alternate scenario	Verification could be online which will require additional liveness check
Related use case	Consumer requests Financial Service from a Financial Institution

Google drive document for ToIP members

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