When people talk about business KYC, they really mean KYB — Know Your Business. Verifying a business customer is not about checking an ID document: you have to prove the company exists, know who runs it, who really owns it and whether it presents a risk. Here are the steps of a KYB verification, the documents to collect and what KYB software should automate.

Business KYC or KYB: the same obligation

AML-CFT due diligence obligations apply to all customers, individuals and legal entities alike. For a company, they cover three levels:

• the entity itself: existence, legal form, activity, registered office;
• the people acting on its behalf: legal representatives, authorized signatories;
• the people who control it: the ultimate beneficial owners (UBOs).

KYB therefore includes KYC: every representative and every beneficial owner is an individual whose identity must be verified.

The 5 steps of a KYB verification

1. Verify the company's legal existence

Starting point: a recent company registration extract. In France, this is the Kbis extract or the extract from the National Business Register (RNE). The information declared by the customer must be matched against the official source: company name, registration number, legal form, registered address, registration date and status (active, in liquidation, struck off).

A registration extract sent as a PDF can be forged: comparing it with the register is more reliable than reading the document.

2. Identify directors and signatories

The legal representative who opens the account or signs the contract must be identified, and their authority to bind the company verified: they must appear in the register or hold a delegation of authority. Their identity goes through a standard KYC check — ID document, plus remote biometric verification if onboarding happens online.

3. Identify the beneficial owners

This is the most delicate step. The beneficial owner is the individual who directly or indirectly holds more than 25% of the capital or voting rights, or who controls the company by any other means. When the company is owned by a holding company, you need to trace the ownership chain up to the individuals.

The beneficial ownership register is a source to consult, but not sufficient proof: it is self-declared and sometimes out of date. If you find a discrepancy between the register and what you observe, you must report it.

4. Screen the company and the people

The company, its directors and its beneficial owners are checked against sanctions and asset freeze lists, politically exposed persons lists and adverse media. A single sanctioned beneficial owner is enough to block the relationship.

5. Assess the risk and decide

Country of registration and activity, sector, structure complexity, company age, screening results: these factors determine the level of due diligence to apply. A multi-layered structure across several jurisdictions does not call for the same checks as a French limited company owned by its manager.

Documents to collect

• Company registration extract less than three months old (Kbis, RNE extract or foreign equivalent).
• Up-to-date articles of association, to check shareholding and powers.
• ID document of the legal representative and, where applicable, the delegation of authority.
• ID documents of the beneficial owners.
• Ownership chart if the structure includes intermediate companies.
• Bank details in the company's name.
• Depending on the risk: latest annual accounts, proof of source of funds, proof of activity.

What KYB software should automate

Done manually, a KYB check takes time: fetching the registration extract, reading the articles, rebuilding the ownership chart, screening each person, chasing the customer for the missing document. KYB software should handle:

• retrieving data from official registers from the registration number alone, so you do not depend on documents supplied;
• checking the authenticity of documents provided — registration extract, articles, bank details — to spot fake documents;
• identifying beneficial owners and verifying each one's identity;
• automatic screening of the company and every related person;
• a risk score based on your criteria and a file that cannot be approved while incomplete;
• monitoring changes: new director, change in share capital, insolvency proceedings.

Mistakes to avoid

• Relying on the registration extract alone. It proves the company exists, not the identity of those who control it.
• Stopping the ownership chain at the first holding company. The beneficial owner is always an individual.
• Only verifying the signatory. Beneficial owners must be identified even if they play no part in the relationship.
• Doing KYB once and for all. A company changes; the file must follow.

How Dataleon handles business KYC

With Dataleon's KYB solution, your customer completes their file in a white-label portal. Data is retrieved from registers, documents are checked, directors and beneficial owners are verified and screened, and the file receives a risk score based on your rules. Your analysts only handle what requires judgment.

FAQ

Is KYB mandatory?

For entities subject to AML-CFT rules — banks, insurers, payment institutions, accountants, notaries and real estate agents, among others — yes: verifying a corporate customer is part of their due diligence obligations.

How long does a KYB check take?

For a simple company, automated checks take a few minutes. Complex, foreign or high-risk structures require a more thorough human review.

Can you verify a foreign company?

Yes, using the registers of the country concerned where they are accessible, supplemented by the documents provided.

Request a demo to see an end-to-end KYB verification.