Evolution of KYB: understanding the history of business verification in Europe

From shade to light: the evolution of KYB in Europe since the 2000s

The KYB, for Know Your Business, is now indispensable for any business that wants to protect itself against fraud, money laundering, identity theft, legal risks and regulatory non-compliance. However, this concept is relatively new in the European compliance landscape.

At the origins: a world centered on KYC and AML

In the 2000s, regulations were mainly focused on KYC (Know Your Customer) And the AML (Anti-Money Laundering). Businesses had to verify the identity of natural persons, but few elements regulated the transparency of legal persons.
The consequences were significant:

• Difficult to identify beneficial owners
• Poor visibility on shareholders and managers
• Multiplication of shell companies and document fraud
• High risks of money laundering via opaque structures

The rise of organized fraud

With the emergence of new digital business models (fintech, marketplaces, B2B exchange platforms), criminals have used breaches in business identification to bypass KYC controls.
It is therefore impossible to ensure AML compliance without increasing transparency on partner companies.

An increasingly structured regulation

The European Union has gradually introduced obligations to:

• Verify the legal existence of a business
• Check where the funds come from
• Identify relationships between entities
• Assess the risks of corruption or illegal financing

KYB then became a pillar of compliance in the financial sector, but also beyond: e-commerce, mobility, logistics, insurance, insurance, B2B services.

The KYB today

Business verification is now a regulatory and strategic prerequisite. It reduces risks and guarantees trust in any business relationship.
The ability to automate these procedures has become a major competitive advantage for digital players, in particular thanks to technological solutions such as Dataleon.

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