Use of External KYC Providers
    • 20 Mar 2024
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    Use of External KYC Providers

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    Article summary

    Use of External KYC Providers

    Synctera is integrated with specific KYC vendors for identity verification, watchlist monitoring, and OFAC screening.

    However, use of external KYC providers may be warranted for various reasons including use of data sources that are more suited to your target customer, stronger familiarity with the vendor, and/or existing contractual arrangements or integrations.

    Generally, the use of an external KYC provider requires the following:

    • Approval from your Sponsor Bank
    • Completed third party risk assessment of the vendor - subject to approval of the bank
      • Includes ongoing assessments after launch
    • Ability to pass over KYC data to the Synctera platform
      • List of checks or verifications performed by the provider for each customer account opening or for ongoing monitoring - this includes fraud checks, document screening, or selfie checks
      • Results of the checks or verifications including pass / fail / risk scoring
      • Any notes or evidence of additional manual reviews performed for verifications that have failed
      • Copies of government IDs that were scanned for onboarding including passport, driver's license or business formation documents such as incorporation docs - these should be utilizing the Synctera Documents API
    • Ability to complete KYC reviews with qualified staff or compliance operations - see requirements to opt-out of Ground Control
      • Clear procedures for how the staff will conduct and document manual KYC reviews that have failed automated checks
      • Types of ID that are accepted and examples of permissible IDs such as government IDs
    • List of the settings and configurations of the KYC provider - shared with Synctera Compliance Operations team and the Sponsor Bank
    OFAC Screening and PEP Screening

    Generally, as part of KYC, the Sponsor Bank is also required to screen customers on an ongoing basis for various checks such as OFAC sanctions lists and Politically Exposed Persons (PEP) screening. These checks may not be outsourced to an external provider due to the sensitivity and criticality of the checks unless expressly approved by the Sponsor Bank. Otherwise, these checks must continue to be performed using the Synctera integrated tools, which already have been reviewed and approved by the Sponsor Bank.


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