KYB
Know Your Business
KYB (Know Your Business) — the check of a corporate client: its structure, beneficiaries and activity, the business equivalent of the KYC procedure.
- What it is
- KYB (Know Your Business) — checking a corporate client
- Equivalent
- The business version of KYC — “know your customer”
- What is checked
- The ownership structure, beneficial owners, activity, reputation
- When
- When opening an account or working with a legal entity
- How to use it
- Prepare a transparent company structure in advance
In plain words
KYB (know your business) is the procedure for checking a company as a client, the business counterpart of the KYC (know your customer) familiar to individuals. When a bank, payment system or partner starts working with a legal entity, it must understand what kind of company it is: who really owns it, what it does, where its money comes from and whether there are risks.
KYB examines the ownership structure (down to the ultimate beneficial owners, UBOs), constitutional documents, type of activity, financial history and reputation, and runs the company and its owners through sanctions and other lists. The aim is to make sure that the legal entity does not conceal anonymous owners, money laundering or other risks and that the business is transparent and lawful.
For entrepreneurs and holding company owners this is a key point: opening an account for a company or starting to work with a partner bank is impossible without passing KYB. A non-transparent structure, concealed beneficial owners or vaguely described activity are a red flag and grounds for refusal. We help build and present the company’s structure transparently so that it passes the business check successfully.
Where KYB is applied
What KYB covers
- The ownership structure
- Type of activity
- Financial history
- Ultimate owners (UBOs)
- Founders
- Controlling persons
- Sanctions lists
- Reputation
- Legal status
- No anonymous owners
- No money laundering
- The business is transparent
How to pass KYB
- 01Gather the company documents
- 02Disclose the structure and UBOs
- 03Evidence the activity and funds
- 04Pass the bank’s check
- 05An account and work with the partner
What you need to know
- KYB is checking a company, the business counterpart of KYC
- The structure, beneficial owners, activity and reputation are examined
- It is needed when opening a corporate account and working with a bank
- The company and owners are run through sanctions lists
- A non-transparent structure is grounds for refusal
Common mistakes
- Coming to a bank with a non-transparent ownership structure
- Concealing the ultimate beneficial owners (UBOs)
- Not preparing constitutional and financial documents
- Describing the company’s activity vaguely
- Underestimating the strictness of the business check
What this means for a BRIDGES client
We help businesses pass KYB: we build and present the company’s structure transparently, disclose the ultimate beneficial owners and prepare the documents and evidence of activity and funds. That way opening an account and working with partner banks succeed rather than running into refusal because of opacity.
Frequently asked questions
01 /What is KYB?
Know Your Business — the procedure for checking a company as a client, the business counterpart of KYC. The bank or partner establishes what kind of company it is, who owns it and where its money comes from.
02 /How does KYB differ from KYC?
KYC checks an individual; KYB a legal entity. KYB additionally examines the ownership structure, the ultimate beneficial owners (UBOs) and the company’s activity.
03 /What is checked under KYB?
The ownership structure down to the beneficial owners, constitutional documents, type of activity, financial history, reputation and presence on sanctions lists.
04 /When is KYB needed?
When opening a corporate account, working with a partner bank, connecting to payment systems and checking counterparties.
05 /Why might you be refused?
Because of a non-transparent structure, concealed beneficial owners or vaguely described activity — a red flag. Transparency and full disclosure remove the questions.
06 /How do you prepare a company for KYB?
Build a transparent structure, disclose the UBOs, prepare constitutional and financial documents and describe the activity clearly. We help do this.
See also
Read next
This material has undergone editorial review by BRIDGES.
Opening a corporate account?
We will build a transparent structure and a file for the KYB check — so that the bank has no questions about your business.