eKYB - A comprehensive guide

Mar 13, 2025

Introduction 

Remember the days when verifying business customers meant drowning in paperwork? Those days are rapidly becoming history, thanks to electronic Know Your Business (eKYB) solutions. Yet many financial institutions still wonder about the real value and implementation challenges of these systems. Let's clear up the confusion and explore why eKYB might be exactly what your institution needs. 

What is KYB? 

KYB, short for "Know Your Business," refers to the due diligence measures a company must undertake to ensure that its business partners are not engaged in illegal activities. This is a critical verification process that must be conducted before engaging in transactions with any organization. 

The KYB process is an integral part of Anti-Money Laundering (AML) and Counter-Terrorism Financing (CFT) frameworks, designed to prevent illicit financial flows. Compared to KYC (Know Your Customer), KYB is a relatively new compliance standard that has gained traction in many major economies in recent years. Regulators have increasingly recognized that businesses, like individuals, can be exploited as conduits for laundering illicit funds. 

Why Traditional KYB Just Doesn't Cut It Anymore 

We've all been there – watching business customers grow frustrated as they wait weeks for account approval. Traditional KYB processes are like trying to build a skyscraper with hand tools. Sure, it works, but at what cost? 

Here's what makes traditional KYB so challenging: 

  1. Time-consuming manual processes  

Picture this: your compliance team spends countless hours manually reviewing business documents, cross-referencing information, and updating spreadsheets. A single business verification can take up to three weeks, sometimes more for complex cases. That's valuable time your team could spend on more strategic tasks. 

  1. The rising cost of compliance  

Running a traditional KYB operation is like maintaining a vintage car – it gets more expensive every year. You need larger teams, more training, and extensive quality control measures. Many financial institutions find their compliance costs increasing by 15-20% annually just to keep pace with regulatory requirements. 

  1. The human error factor  

Even your most detail-oriented staff members make mistakes. When handling hundreds of documents daily, errors are inevitable. A single mistyped company number or overlooked document can lead to compliance issues or, worse, regulatory fines that could have been avoided. 

Enter eKYB: The Smart Way Forward 

Think of eKYB as your institution's digital transformation superhero. It's not just about moving paperwork online – it's about fundamentally reimagining how we verify and monitor business customers.

The Electronic Know Your Business (e-KYB) solution is a sophisticated corporate verification system designed to help companies comply with Anti-Money Laundering (AML) and Counter-Terrorism Financing (CTF) regulations. As an advanced alternative to traditional KYB methods, e-KYB leverages digital verification to enhance security and efficiency in business authentication. 

Financial institutions and enterprises worldwide are increasingly exposed to financial fraud and corporate identity theft. e-KYB solutions streamline business verification, facilitate seamless onboarding, and mitigate the risks associated with partnering with high-risk entities, ensuring a more secure and compliant operational environment. 

How eKYB Works: Breaking Down the Process 

At its core, eKYB streamlines the business verification process by pulling data from trusted sources and automating compliance checks. Here’s how it typically works: 

  1. Data Collection – The system gathers company registration details, ownership structures, and financial statements from government and private databases. 

  1. Identity Verification – Key stakeholders, such as beneficial owners and directors, are authenticated using eKYC (electronic Know Your Customer) methods, including biometrics and digital ID checks. 

  1. AML Screening – Businesses and individuals are checked against anti-money laundering (AML) and politically exposed persons (PEP) lists to flag potential risks. 

  1. Continuous Monitoring – Unlike traditional KYB, which often stops at onboarding, eKYB ensures ongoing compliance through real-time alerts and periodic reviews. 

In context of Vietnam, eKYB process operates within the framework established by the State Bank of Vietnam (SBV) and aligns with Decree 87/2019/ND-CP on electronic transactions in financial activities. The process combines digital verification methods with Vietnam's specific regulatory requirements. 

The eKYB process in Vietnam follows a structured verification pathway that integrates with national databases and regulatory systems. Financial institutions must verify business information through the National Business Registration Portal (NBRP) and cross-reference it with tax authority databases. 

To establish beneficial ownership, KYB regulations may require identifying information such as: 

  • Verification of the identity of business owners and stakeholders 

  • Registration records and licensing documents 

  • Tax information authentication, including company name, tax identification number (TIN), and company address 

  • Business registration certificate 

Benefits of eKYB vs traditional Business Onboarding 

By implementing eKYB verification, customers receive numerous benefits, primarily in boosting up business onboarding spped, streamlining loan origination, and increase conversion rates. 

Implementing eKYB verification brings numerous benefits, primarily in speeding up business onboarding, streamlining loan origination, and boosting form conversion rates. 

  1. Revolutionizing Business Onboarding 

The shift from manual to electronic business verification delivers measurable operational advantages. While traditional onboarding demands extensive manual intervention, eKYB streamlines the entire process through intelligent automation: 

  • Accelerated Processing: Advanced validation systems compress verification timelines from weeks to minutes, enabling rapid business onboarding while maintaining compliance standards. 

  • Enhanced Operational Efficiency: Automation of routine tasks allows compliance and onboarding teams to focus on strategic initiatives, improving resource allocation and productivity. 

  • Superior Accuracy: Systematic validation against authoritative sources minimizes errors while ensuring consistent compliance verification. 

  1. Maximizing Conversion Success 

eKYB verification drives business growth through: 

  • Seamless User Journey: Friction-free application processes reduce abandonment rates while increasing client satisfaction. 

  • Improved Conversion Metrics: Efficient verification procedures consistently outperform traditional methods in successful customer acquisition. 

  • Relationship Building: Systematic, transparent processes establish trust from initial contact, fostering long-term business partnerships. 

  1. Extensive Risk Assessment 

  • Continuous monitoring versus periodic reviews: Traditional systems rely on scheduled reviews, often quarterly or annually. eKYB platforms monitor business status 24/7, detecting changes in company registration status, financial health indicators... 

  • Systematic detection of suspicious patterns: the system provides advanced analytics to identify: Advanced analytics identify: Unusual transaction patterns, unexpected business relationship changes, abnormal financial activities... 

  • Standardized risk assessment protocols: eKYB ensures consistent evaluation to continuous monitoring of business customers, enhanced detection of suspicious activities and improved regulatory compliance documentation 

Real-world Application: Who’s Using eKYB? 

Banks and Financial Institutions 

Major banks are leveraging eKYB to streamline corporate account openings, reduce manual labors and enhance fraud detection.  

FinTech Startups 

For digital lenders and neobanks, eKYB is a must-have, ensuring fast, compliant business onboarding without human bottlenecks. 

Payment Service Providers 

With cross-border transactions growing, eKYB helps PSPs verify business clients while staying compliant with global financial regulations. 

Cryptocurrency Sector 

With the rapid expansion of the cryptocurrency industry, eKYB regulations have been extended to ensure compliance, prevent financial crimes, and monitor transaction activities. To mitigate risks such as money laundering and terrorist financing, cryptocurrency organizations can leverage advanced business verification solutions, strengthening security and regulatory adherence. 

How FPT eID can help in eKYB?

FPT eID provides eKYB service to help you verify a company's identity securely, via an online platform that adheres your country's regulatory compliances.

Thanks to our continuous upgrading, eKYB from FPT eID can:

  • Automatically identify and extract information about 5 types of business registration licenses.
  • Verify information with the Business Information Portal and the General Department of Taxation
  • Integrate with eKYC solution to verify the identification of each business representative
  • Integrate with FPT.CA solution for quick and secure business digital signing

The entire process can be done efficiency, reliably, and consistently, saving the business time while also ensuring a frictionless customer experience.

Start your eKYB today by getting in touch with us. We are always ready to assist you.

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eKYB - A comprehensive guide
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eKYB - A comprehensive guide

Mar 13, 2025