Know Your Customer
Know Your Customer (KYC) encompasses the processes for verifying customer identity, assessing risk, and ensuring regulatory compliance throughout the customer lifecycle. This use case addresses managing complex multi-jurisdictional requirements, verifying identities across channels, conducting risk assessments based on geography and relationships, continuously monitoring customer activities for suspicious behavior, reducing false positive alerts, and maintaining accurate customer information across systems for compliance reporting.
The Challenge¶
Organizations face significant challenges in KYC management:
- Regulatory complexity — Multiple jurisdictions with different KYC requirements and compliance obligations
- Identity verification — Verifying customer identity across different channels and jurisdictions
- Risk assessment — Assessing customer risk based on multiple factors including geography, relationships, and behavior
- Data fragmentation — Customer information scattered across multiple systems, channels, and jurisdictions
- Real-time monitoring — Continuous monitoring of customer transactions and activities for suspicious behavior
- False positives — High rates of false positive alerts requiring manual review
- Compliance reporting — Generating compliance reports for regulators and internal stakeholders
- Data quality — Maintaining accurate and up-to-date customer information across systems
Traditional KYC systems operate in silos and lack the integrated view needed for comprehensive customer risk assessment and compliance.
Why EKG is Required¶
Enterprise Knowledge Graphs provide powerful KYC capabilities:
- Unified customer view — Connect all customer information across systems, channels, and time periods
- Identity resolution — Link customer identities across different systems and channels
- Relationship analysis — Understand customer relationships and connections for risk assessment
- Network analysis — Identify suspicious networks and patterns through graph analysis
- Real-time monitoring — Continuously monitor customer activities and transactions
- Regulatory integration — Link customer data to regulatory requirements and compliance obligations
- Risk aggregation — Assess customer risk based on multiple factors and relationships
- Pattern detection — Identify suspicious patterns and behaviors through graph algorithms
Business Value¶
- Regulatory compliance — Meet KYC requirements and avoid penalties and sanctions
- Risk mitigation — Identify and address customer risks before they become problems
- Fraud prevention — Detect and prevent fraud through network analysis and pattern detection
- Operational efficiency — Automate KYC processes and reduce manual review
- Cost reduction — Reduce false positives and improve alert accuracy
- Customer experience — Streamline onboarding and reduce friction for legitimate customers
Components¶
Related Use Cases¶
Know Your Customer depends on and integrates with several other use cases:
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Legal Entity Management - KYC uses Legal Entity Management for comprehensive information about corporate customers, their legal structures, ownership, and relationships. See Legal Entities for details.
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Vendor Management - Vendor vetting processes are similar to customer KYC, especially for regulated industries like banks. Vendor KYC requires similar identity verification, risk assessment, and compliance checks as customer KYC, and can leverage KYC processes and data.
Core Record Management¶
Know Your Customer uses Core Record Management for authoritative reference data:
- Countries - Geographic reference data for customer risk assessment
- Jurisdictions - Legal and regulatory jurisdictions for compliance
- Regions - Geographic regions for risk classification
- Addresses - Address reference data for identity verification
- Legal Entities - Legal entity reference data for corporate customers
The Core Record Management use case is a child of Know Your Customer, providing the foundational reference data needed for KYC processes.