KYC vs KYB

Who this is for

This guide is for teams deciding whether they need customer identity verification, business verification, or both in an onboarding flow.

Key takeaways

• KYC means Know Your Customer and usually focuses on verifying an individual person.
• KYB means Know Your Business and focuses on verifying a company, merchant, or legal entity.
• Many financial, marketplace, and B2B onboarding flows need both KYC and KYB.
• KYB often adds business registry checks, ownership discovery, director checks, sanctions screening, and manual review.

01 What is KYC?

KYC, or Know Your Customer, is the process of verifying an individual customer. A typical KYC flow may collect a name, date of birth, address, government ID, selfie, phone number, email, or other identity evidence.

KYC is common in banking, fintech, payments, crypto, lending, age-restricted products, marketplaces, and other services that need to know who a user is before granting access.

• Common checks: government ID verification, document OCR, face matching, liveness detection, proof of address, sanctions screening.
• Common users: consumers, account holders, applicants, workers, creators, drivers, renters, and individual merchants.

02 What is KYB?

KYB, or Know Your Business, is the process of verifying a business or legal entity. Instead of only checking a person, KYB looks at whether the company exists, who owns it, who controls it, and whether the business creates compliance or fraud risk.

A KYB flow may verify business registration, tax identifiers, directors, officers, beneficial owners, business address, industry, sanctions exposure, and supporting documents.

• Common checks: business registry lookup, legal entity verification, beneficial ownership discovery, director verification, merchant risk review.
• Common users: companies, merchants, sellers, vendors, platforms, corporate customers, and financial counterparties.

03 KYC vs KYB: the difference

The simplest difference is the verification subject. KYC verifies a person. KYB verifies a business. In practice, KYB often includes KYC because a business is controlled by people.

For example, a marketplace onboarding a seller may need KYB to verify the seller's company and KYC to verify the owner or authorized representative. A fintech onboarding a corporate account may need to verify the legal entity, screen the company, identify beneficial owners, and check the individuals behind the business.

04 When you need KYC

You likely need KYC when the account belongs to an individual person, when access depends on age or identity, or when regulation requires customer due diligence.

KYC also matters for fraud prevention. Even outside regulated finance, identity checks can reduce fake accounts, account takeover recovery abuse, rental fraud, gig worker impersonation, and marketplace scams.

05 When you need KYB

You likely need KYB when onboarding businesses, merchants, sellers, vendors, corporate customers, or counterparties. KYB is especially important when money movement, regulated services, invoices, payouts, lending, procurement, or platform trust is involved.

KYB workflows can be more complex than KYC because company records vary by country, ownership structures can be layered, and the right answer may require human review.

06 How to choose providers

If you only onboard individuals, start with KYC providers and identity verification platforms. If you onboard companies, prioritize KYB providers and check whether they support your jurisdictions, registry sources, UBO requirements, and review workflow.

If you onboard both people and businesses, look for providers that can connect KYC and KYB evidence in one workflow, or use an orchestration layer to combine specialist vendors.

• For individual onboarding, compare document verification, biometrics, liveness, AML screening, and proof of address.
• For business onboarding, compare registry coverage, UBO discovery, director checks, sanctions screening, and case management.
• For marketplaces and fintechs, check whether the provider can handle both business and individual verification in the same flow.

FAQ

How to use this guide

Use this guide to understand the core concepts, compare provider claims, and decide what to verify directly before choosing a vendor.