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Trakti How to conduct KYC checks (properly)

How to conduct KYC checks (properly)

on November 7, 2022

KYC and related processes such as Anti Money Laundering and identity fraud controls are one of the main challenges that companies and institutions are facing at the moment.

These procedures are timely and expensive, and many businesses have had to update the way they conduct KYC as they could not rely on the standard methods they had adopted.

Luckily many innovative solutions exist to make the whole thing much quicker. And less expensive. All this while connecting to international databases and making it part of an automated stream for customer and supplier onboarding.

But what is KYC? 

KYC (Know Your Customer) is a process that companies carry out in order to verify the identity of their customers to comply with current regulations and laws.  

This procedure is especially relevant for businesses in financial and banking areas as well as real estate, insurance, or trading for example. And since 2020 (and the pandemic) the necessity for the digitalization of KYC has become evident. Want to know more about the KYC process? Have a look at this article

Why is KYC important? 

Candidacy is a process that we all know very well, so there is no need for us to say that this is how you choose who will work with/for your company. That is how we make sure we are not bringing in our organization someone who is not trustworthy. But can you really be sure? 

It’s amazing how many businesses think that since you’ve been working with a company or a person for a while, there is no need for verification of any sort. 

“At its most basic, companies that deal with individuals have a responsibility to ensure they are who they say they are and live where they say they live.”

Elliot Shaw, Business development manager at W2

But, and there’s a but, if you have ever conducted a KYC check before you know what kind of a job that is. These checks not only permit the verification of identity (onboarding), but also the evaluation of the risk of money laundering for this candidate. And the latter is an ongoing process.

The procedure is long, complicated, and it involves many parties. Therefore, you must make this procedure as cost-effective as possible. 

Now that you know what KYC is and why it’s important, let’s see how to embed it seamlessly into your onboarding processes cutting down costs. 

KYC integration

Wasting time on back-office operations is part of the past. Digitalizing and automating the KYC process is the best way for HR to lower the costs for this (necessary) process and save time that could be used for much more important tasks. 

To meet these needs Trakti has partnered with W2, offering a flawless integration of KYC and AML checks into your contracts. In addition, Trakti offers open APIs to easily integrate our platform with third-party services facilitating the sharing of all information and documentation our contract negotiation and contract management framework creates with your preferred systems. 

Thanks to Trakti you can choose whether to have KYC checks at the candidacy stage or at the contracting stage. What’s the difference? Well, you’re about to find out. 

Once you have created an automated onboarding flow in Trakti, candidates will be able to apply for the position.  

This is a good time to insert a KYC check for your candidates. At this stage you can embed the KYC integration in the flow while the nomination is ongoing – that will result in a very high compliance rate. Unfortunately, this will turn out to be quite expensive due to the checks being conducted on all candidates. 

Alternatively, once the selection has been made, you can insert the KYC check at the contracting stage – meaning that before signing the contract the counterpart will have to undergo KYC checks. 

Have a look at how this is done, click here to see our guide! 

Whether you decide to embed the checks at the candidacy or contracting stage, the most important thing to keep in mind is to conduct KYC checks that are cost-effective. And what is most effective than an automated CLM platform with integrated KYC & AML? 

Try it out, the first 14 days are free! No credit card is required. 

Sarah GiannelliHow to conduct KYC checks (properly)

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