Guide · KYB fundamentals
KYB vs KYC: what is the difference, and which one do you need?
KYC, Know Your Customer, verifies a person: that they are who they say they are, usually with an identity document. KYB, Know Your Business, verifies a company: that it is legally registered, who owns and controls it, and whether the company or its people carry sanctions, PEP or financial crime risk. Most firms that deal with companies need both, because a KYB check ends with identity checks and screening on the people behind the business.
LAST UPDATED OCT 2026 · GENERAL GUIDANCE, NOT LEGAL ADVICE
KYC in one paragraph
Know Your Customer is the identity check on an individual. It confirms a name, date of birth and address against an identity document, often adds a selfie and a liveness test to prove the person is present, and screens the person against sanctions and politically exposed person lists. Banks, payment apps and exchanges run it at scale whenever individuals open accounts.
KYB in one paragraph
Know Your Business applies the same idea to a company, and it is harder because a company cannot hold up a passport. A KYB check identifies the legal entity from its registration documents, maps who owns and controls it down to the ultimate beneficial owners, identifies its directors, screens the company and every one of those people, and keeps the documents that prove each fact.
KYB vs KYC, side by side
What is verified
KYC
A person's identity
KYB
A company's existence, ownership and control
Typical evidence
KYC
Passport or national ID, proof of address, often a selfie
KYB
Certificate of incorporation or trade licence, registry extract, shareholder register, ownership declarations
Who gets screened
KYC
The individual
KYB
The company, its directors, its shareholders and its ultimate beneficial owners
Where the risk hides
KYC
Impersonation and stolen or synthetic identities
KYB
Layered ownership, nominees and shell companies between you and the real owner
Typical tools
KYC
Identity verification platforms with document scanning and liveness
KYB
KYB and counterparty due diligence platforms with ownership mapping and screening
When it repeats
KYC
When the customer's details or risk change
KYB
When ownership, directors or the lists change, and on a review cycle set by risk
Where KYB and KYC meet: the beneficial owner
Every KYB check ends with people. Anti-money laundering rules define a beneficial owner as the natural person who ultimately owns or controls a company, commonly anyone holding 25 percent or more of the shares or voting rights, with the exact test set by each jurisdiction. Once KYB has found those people, they are identified and screened much as KYC would treat an individual customer.
Sanctions law adds a second line. Under the US 50 percent rule, a company owned 50 percent or more, directly or indirectly, by one or more sanctioned persons is treated as sanctioned itself, even if it appears on no list, and the EU and UK apply their own ownership and control tests. A KYB check that stops at the first layer of ownership misses exactly that.
Which one do you need?
KYCK is built for the second and third cases: KYB software that onboards companies, maps their owners and screens everyone it finds. For high-volume consumer identity checks with selfies and liveness, an identity verification platform fits better; our Sumsub comparison explains where that line sits.
What the law asks for
In most jurisdictions KYB is not a separate law but part of customer due diligence. In the UAE, Federal Decree-Law No. 20 of 2018 and its implementing regulation, Cabinet Decision No. 10 of 2019, require regulated firms to identify and verify their customers, including legal persons and their beneficial owners. In the UK the Money Laundering Regulations 2017 set the same expectation, and in the EU the Anti-Money Laundering Regulation, which applies from July 2027, harmonises it across member states. Our EU AMLR briefing covers what changes.
Sanctions law applies to everyone, regulated or not. Trading with a company owned by a sanctioned person is a breach whether or not you are a bank, which is why trading firms, shipping companies and their suppliers run KYB too.
How often KYB should be repeated
A KYB check describes the company on the day it was done. Ownership changes, directors are replaced and lists are updated without notice, so the check has to be repeated: on a cycle set by the counterparty's risk, and whenever something material changes. Our article on why counterparty risk is a cycle explains how to run that without re-onboarding everyone.
Frequently asked questions
Is KYB part of KYC?
In regulation, yes: KYB is customer due diligence applied to a legal person. In practice the two are run with different evidence and often different tools, because verifying a company means mapping its ownership rather than checking a face against a passport.
What documents are needed for a KYB check?
Typically a certificate of incorporation or trade licence, a recent registry extract, the shareholder register or an ownership structure chart, identification for directors and beneficial owners, and a declaration of beneficial ownership. Higher-risk counterparties may also be asked for source of funds and financial statements.
Do unregulated businesses need KYB?
Usually yes, for practical reasons. Sanctions law applies to everyone, banks ask their clients who they trade with, and some rules reach beyond financial firms, such as the UAE requirement for VAT-registered businesses to verify their suppliers.
What is a UBO?
An ultimate beneficial owner is the natural person who ultimately owns or controls a company, directly or through other entities. Identifying UBOs is the core of KYB, because the person behind several layers of holding companies is where sanctions and corruption risk usually sits.
Can one tool do both KYB and KYC?
Some platforms cover both, with different depth. Consumer identity platforms are strongest on individuals; counterparty platforms such as KYCK are strongest on companies and their ownership. Choose by what most of your onboarding looks like.
Onboarding companies, not just people?
KYCK runs KYB end to end: portal, documents, ownership, screening and the evidence file.
This guide is general information as of October 2026, not legal advice. Rules differ by jurisdiction and change over time: confirm what applies to you with your supervisor or legal adviser before relying on it.