KYB Solutions: A Complete Guide to Business Verification Technology

A KYB solution is any technology, process, or service that helps organizations verify business identities and assess risk. Solutions range from manual workflows using public records to fully automated platforms that verify businesses in seconds.

The KYB Solutions Landscape

Solution Categories

Manual processes

Description: Staff research using public databases
Best For: Low volume, high complexity

Data providers

Description: Raw business data feeds
Best For: Building custom solutions

Point solutions

Description: Single-function tools (e.g., sanctions only)
Best For: Filling specific gaps

Integrated platforms

Description: End-to-end verification workflows
Best For: Scale and consistency

Managed services

Description: Outsourced verification teams
Best For: Variable volume, limited staff

Build vs. Buy Considerations

Organizations often debate whether to build KYB capabilities internally or purchase solutions.

Time to deploy

Build: Months to years
Buy: Weeks to months

Data access

Build: Must negotiate individually
Buy: Pre-integrated sources

Maintenance

Build: Ongoing engineering burden
Buy: Vendor responsibility

Customization

Build: Full control
Buy: Configurable within limits

Cost structure

Build: High fixed, low marginal
Buy: Lower fixed, per-verification cost

For most organizations, the data access challenge alone makes buying preferable—aggregating Secretary of State data across 50+ jurisdictions requires significant ongoing investment.

Core Capabilities of KYB Solutions

1. Entity Verification

The foundation: confirming a business exists and is who it claims to be.

Registry lookup: Query business registries for formation and status

EIN/TIN verification: Validate tax identification numbers

Address verification: Confirm business locations exist

Entity resolution: Match entities across data sources

2. Beneficial Ownership

Identifying the natural persons who own or control the business.

Ownership extraction: Parse ownership from filings and disclosures

UBO calculation: Trace ownership through layers to 25%+ owners

Control identification: Identify individuals with significant control

BOI collection: Gather beneficial owner identity documents

3. Risk Screening

Checking businesses and owners against risk indicators.

Sanctions screening: Check against OFAC, EU, UN lists

PEP screening: Identify politically exposed persons

Adverse media: Monitor for negative news

Watchlist screening: Check law enforcement and regulatory lists

4. Document Collection and Verification

Gathering and validating supporting documentation.

Document requests: Collect articles of incorporation, licenses

Document extraction: Parse data from uploaded documents

Authenticity checks: Verify documents aren't forged

ID verification: Verify beneficial owner identities

5. Workflow and Decisioning

Managing the verification process and outcomes.

Case management: Track verifications through stages

Risk scoring: Calculate risk based on multiple factors

Rules engine: Apply business logic to approve/reject/escalate

STP: Auto-approve low-risk applications

Manual review: Route complex cases to analysts

6. Ongoing Monitoring

Maintaining current knowledge after onboarding.

Continuous screening: Re-check sanctions and watchlists

Registry monitoring: Detect status changes, new filings

Adverse media alerts: Surface new negative news

Periodic refresh: Trigger re-verification on schedule

Evaluating KYB Solutions

Data Quality Questions

Coverage: Which jurisdictions and entity types are supported?
Freshness: How current is registry and screening data?
Depth: Can ownership be traced through multiple layers?
Accuracy: What's the false positive rate on screening?

Integration Questions

API availability: Is there a developer-friendly API?
Workflow flexibility: Can verification steps be customized?
Existing systems: Does it integrate with your CRM, core banking, or case management?
White-label options: Can the experience be branded?

Operational Questions

STP rate: What percentage of verifications complete automatically?
Turnaround time: How long do manual reviews take?
Scalability: Can it handle volume spikes?
Support: What analyst tools and training are provided?

Compliance Questions

Regulatory alignment: Does it meet BSA, CDD Rule, CTA requirements?
Audit trail: Is there complete documentation for examiners?
Configurability: Can rules adapt to your risk-based approach?

Solution Architecture Patterns

Pattern 1: Single Platform

All KYB functions in one integrated solution.

Pros: Unified experience, single vendor relationship, consistent data model

Cons: Vendor lock-in, may not be best-in-class at everything

Pattern 2: Best-of-Breed Stack

Specialized tools for each function, integrated via APIs.

Pros: Optimal capabilities per function, flexibility to swap components

Cons: Integration complexity, data reconciliation challenges

Pattern 3: Platform + Specialists

Core platform with point solutions for specific needs (e.g., specialized international coverage).

Pros: Balance of integration and specialization

Cons: Still requires some integration work

Industry-Specific Considerations

Different industries emphasize different capabilities:

Fintech: Speed, API-first, STP rate

Banking: Depth of due diligence, audit trail

Payments: Sub-merchant onboarding, risk scoring

Marketplaces: Seller verification, fraud prevention

Lending: Business data for underwriting, speed

The Evolution of KYB Solutions

KYB technology continues to advance:

Business graphs: Better ownership and relationship mapping

Machine learning: Improved entity resolution and risk scoring

Real-time data: Faster verification, continuous monitoring

Orchestration: Flexible workflows across multiple data sources

Embedded KYB: Verification built into product experiences