KYC (Know Your Customer)
KYC (Know Your Customer) refers to the identity verification of customers and business partners that financial service providers — including payment providers and marketplaces — must carry out before commencing business.
KYC (Know Your Customer)
KYC (Know Your Customer) comprises all measures for identifying and verifying customers, merchants, or business partners. In payment processing, KYC is a central component of combating money laundering: Before a merchant can accept payments and receive payouts, their identity must be verified.
For marketplaces, KYC means: Every seller (sub-merchant) who receives payments via the platform must be identified. The verification typically includes ID documents, commercial register extract (for companies), details of the beneficial owner, and a proof of address. In Switzerland, the due diligence obligations of the AMLA and the AMLO-FINMA apply.
KYB (Know Your Business) is the variant for companies: Here, not only the natural person but also the company itself is verified — legal form, commercial register, purpose, and beneficial owners. For platform operators, it is crucial: If KYC is handled by the PSP, your own effort is significantly reduced.
KYC examples
A new merchant registers on a Swiss marketplace. The PSP requests a copy of an ID, proof of address and an excerpt from the commercial register before the first payout is made.
A sole proprietor is verified via video ID in 5 minutes — automated KYC accelerates your onboarding.
In the case of a GmbH (limited liability company), the beneficial owner is also checked — the person holding more than 25% of the shares.
KYC FAQ
What is KYC?
KYC (Know Your Customer) is the identity verification of customers and business partners. In payment processing, merchants must be verified before they can accept payments and receive payouts.
What is the difference between KYC and KYB?
KYC verifies the identity of natural persons. KYB (Know Your Business) additionally verifies the company itself — legal form, commercial register, business purpose and beneficial owners.
Who performs KYC on marketplaces?
Usually the payment service provider (PSP) who processes the payouts to sellers. The marketplace operator collects the data and forwards it to the PSP, who performs the actual verification.
Which documents do you need for KYC in Switzerland?
Typically: copy of ID (passport or ID card), proof of address, and for companies, an additional extract from the commercial register and details of the beneficial owner. The exact requirements depend on the transaction volume and the risk class.
From what amount is KYC mandatory?
According to GwV-FINMA, thresholds apply to electronic payments: Identification is required from CHF 5,000 per year. In the event of higher risk or larger volumes, stricter requirements apply.
