Training Tip #2

Know Your Customer (KYC)

Today's post focuses on the Know Your Customer process, otherwise known as KYC. This process happens when the merchant fails to be authenticated on the e-identitycheck.

Successful Authentication

Let's first look at the report that NetPay gets back to say that the merchant's identity has been authenticated successfully. Sensitive information has been removed or redacted from the image below for purposes of Data Protection.

You can see, in green letters at the top of the report, that this individual's identity has been authenticated. There is also a summary of what score the individual achieved on the Authentication Index - in this example, 80 - and that ID Confirmation has been achieved to the required level - Yes.

The next section covers Confirmation Indicators, showing where there have been matches against Current Address, Previous Address, Age and Time at Current Address. Current Address looks at ID and Address and Address Only, and at what was the oldest source. This individual has many matches.

Each search is also given a unique reference number.

Unsuccessful Authentication

This example report below shows an unsuccessful authentication. Again, sensitive information has been removed or redacted from the image below for purposes of Data Protection.

In red letters, at the top, under Authentication Details, the report clearly states that this authentication has failed. The summary also shows the Authentication score as 30, and the ID Confirmation states Yes. This individual's ID has been confirmed but the number of sources that the ID has been checked against is of insufficient quality and/or number, hence the low score.

In the Common Indicators section, you will see a difference in the number of matches made under Current Address (ID and Address and Address only), and Age.

This report, even though the authentication failed - the score was below the required score of 40 - also has a unique reference number.

Because this individual's identification has not been authenticated, the reseller would now have to complete the Know Your Customer process.

The Know Your Customer Process

Because e-identitycheck was unable to authenticate the individual electronically, the process to certify identity becomes a manual process.

During the accreditation training, the reseller will have completed a Template of Certification, a document where a sample of handwriting was provided.

The Know Your Customer (KYC) process requires the reseller, having checked the merchant’s ID, to write the following on the ID:

“I certify this is a true copy and true likeness of the original”.

The reseller must also complete the following, also on the ID:

  • Name
  • Signature
  • Date
  • Reseller Code

What information should the ID show?

The ID that you get from the merchant should contain the following:

  • Name
  • Address
  • Date of birth
  • Nationality
  • Country of Residence

How many pieces of ID do I need?

You need two separate pieces of ID. One piece of ID is not sufficient, even if it shows all of the required information.

  • Personal ID will show the merchant’s name, date of birth, nationality and country of residence
  • Address ID will show merchant’s address.

What ID is acceptable?

Accepted personal ID for the merchant can include:

  • Current signed passport (if expired, can only be used for ID for 3 months after expiration)
  • UK Visa or Right of Abode
  • EU ID Card (for EU nationals if passport not presented)
  • Current UK photographic Driving Licence (provisional is acceptable for under 20s)†
  • Firearms or Shotgun Certificate, bearing signature and photo
  • Identity Card issued by the Electoral Office for Northern Ireland

†This item may be used for evidence or name OR evidence of address, but not for both

Acceptable address ID for the merchant can include:

  • Mortgage statement from a recognised lender (less than 12 months old)
  • Local Authority Council Tax Bill (less than 12 months old)
  • Local Authority rent card or tenancy agreement
  • Bank/building society statement (less than 3 months old)
  • Credit card statement (less than 3 months old)
  • Utility bill (less than 3 months old – mobile phone and cable/satellite TV not accepted)
  • Current UK photographic Driving Licence (Provisional is acceptable for under 20s)†
  • Original Inland Revenue tax notification (not P45/P60)

† This item may be used for evidence of name or evidence of address, but not both If you have any questions about the Know Your Customer process, either leave a comment below, contact NetPay Customer Services on 0333 311 0200

Resources:

Experian Identity Checks
Experian Reason Codes