Know Your Customer (KYC)-What is it and why is it important?

These institutions include banks, medical aid companies, insurance companies, asset management firms and broker dealers as well as credit unions. It is a significant tool in the fight against rampant financial crimes such as money laundering or fraud.

KYC is the fundamental principle behind anti-money laundering and the abolition of terrorist financing. Financial institutions and professionals working within the financial sector ought to know all their customers and their customer’s businesses. KYC helps curb risks associated with financial crimes and also aids in the comprehension of customer behaviours.