All About The Know-Your-Customer (KYC) Process

Know-Your-Customer (KYC)

All financial institutions in Singapore have the responsibility to detect, deter and prevent any illicit activities in Singapore such as money laundering and terrorism funding. Hence, corporate service providers like Margin Wheeler are required to monitor and report activities that could be harmful to Singapore’s financial system through KYC, which is part of the customer due diligence process.

What is KYC?

 KYC is a process of verifying the identity of customers either before or when they start doing business with you. It consists of a set of processes and tools that help financial establishments, corporate service providers and vendors gather and verify information about their customers.

The KYC process 

The KYC process can be done both online and offline. Both processes will require proof of identity and proof of address along with a recent photograph.

Offline

This process requires you to fill in an onboarding application with copies of the required paperwork in person or via mail.

Doing KYC requires a lot of manual effort such as data sorting and data entry, which can result in more errors and remediation costs. This means that companies can spend a lot of time on KYC compliance for a single customer, sometimes up to weeks or months.

Online

For online applications, your corporate service provider will provide you with a form to fill in. You will need to provide other required documents together with this form. These documents will then be manually verified by your service provider and will liaise with your customer to finish the process. 

KYC for company owners

For business owners who are looking to open a company in Singapore, they are required to go through screening and comply with KYC guidelines.

This process helps maintain the integrity and reputation of your Singapore-based company. It ensures that clients do not engage in illegal business activities that could harm your company, Singapore, or your clients’ own country as well.

Documents for KYC

Your director, corporate shareholders and individual shareholders all require different sets of documents.

Here are the documents that your director will need depending on their citizenship status: 

Here are the documents that your individual shareholders will need depending on their citizenship status: 

The documents required from corporate shareholders depend on which jurisdiction the company is incorporated. Here are some documents that may be required:

• Certificate of Incorporation/Registration or equivalent company formation document showing the date and place of incorporation
• Business Profile/Certificate of Incumbency or equivalent company registry record with a list of directors & shareholders and registered office address
• Certificate of Appointment of Corporate Representative and Directors’ Resolution in Writing (required only where a corporate representative has been appointed)
• Passport/NRIC and proof of residential address (issued within last three months) for each individual who owns or controls the corporate shareholder

How to clear KYC screening

Here are some tips that can make it easier for you to clear KYC screening

• Stay available and be in contact with your service provider

If you remain contactable, you may even be able to incorporate your company within a matter of hours. Your corporate service provider will ask you several questions, such as your motive for starting your business or the type of account you use for transactions. They may also ask you for a video call to verify your identity.

• Make clear copies of all documents

Other than ensuring that all your documents are accurate, you should also make sure that they are not blurred when sent over to your service provider. You should also ensure that there are no details that are cropped out. Apps like CamScanner will help you get this done.

• Have a clear business description

There should be a summary of what your company does and what industry it is active in. Generally, it should answer the following questions:

• What is your business name?
• Who owns the business?
• Who are you selling to?
• What product or service are you selling?
• How are you structuring your company?

As long as the above is done, you should be able to get through the KYC process efficiently and incorporate your company. As one of the top rated corporate service providers in Singapore, Margin Wheeler has experience to deal with these things. Be sure to give us a call or drop us a message if you ever need help.