Best know your customer (KYC) software 2024

Have you ever heard about Know Your Customer (KYC) technology? Well, how wouldn’t you? Currently, the popularity of the know-your-customer tech is soaring. While its initial use is in financial institutions, it’s now expanding its application to online companies.

The KYC solution is essential for ensuring the security and integrity of financial transactions, especially in digital banking systems. More precisely, it involves understanding complex customer relationships to prevent unauthorized activity, such as identity theft and fraud.

But, implementing KYC software is a win-win situation. Aside from protecting your customers, you’ll also establish better risk management, data accuracy, efficiency, and a lot more.

So, if you want to learn more, stay with us while we review the 5 top-performing KYC providers in 2024 and address critical challenges in the implementation of this software. We’ll also recommend a few user-friendly ways to overcome them. Let’s get right into it!

Top 5 KYC service providers - shortlist

1. iDenfy ﹘ industry-leading KYC solution for 2024
2. Seon ﹘ top KYC provider with AI-driven insights
3. ID.me ﹘ best KYC software for simplifying identification
4. Onfido ﹘ approved KYC provider for automation
5. Veriff ﹘ KYC service provider with unique security features

What to consider when choosing KYC software?

Selecting the best KYC software can be challenging in the realm of numerous KYC vendors. That’s why we stick to the most essential features, including identity and document verification, customer due diligence, AML features, and fraud prevention. These features help businesses mitigate risk, ensure compliance, and operate securely. So, let’s learn more about this!

1. Identity and document verification

This aspect is one of the most important. Regardless of the KYC software you select, it must come with functionalities that will confirm the identity of your customers. These features include authentication of customers’ identity, as well as documents and biometric verification.

2. Customer Due Diligence (CDD)

The customer due diligence feature is crucial for conducting regular assessments of your customer relationships. As a result, you’ll be able to ensure adherence to regulatory requirements over time easily.

3. AML features

Usually, all KYC software comes with anti-money laundering (AML) features. Also, you can even screen customers against global watchlists, sanctions lists, and politically exposed persons (PEP) lists. All of this helps you monitor transactions over a certain period and ensure there is no malicious activity.

4. Fraud Prevention

KYC is all about preventing fraud. Therefore, the software you choose needs to come with robust security practices. Some of them include face matching, which is comparing the customer’s selfie with the photo in their ID documents, or a liveness check or ensuring that a real person takes the selfie.

You can also look for fraud prevention features, like spoof detection, referring to advanced algorithms that detect and prevent spoofing attempts, such as the use of masks or deepfakes.

5. Compliance with Regulatory Requirements

In order to ensure you’re using a reliable KYC solution, look for compliance with regulatory requirements. Therefore, you’ll be able to see whether the software sticks to necessary customer identification processes and verifies all customers on a regular basis and according to regulatory guidelines.

6. Risk Assessment

The primary purpose of risk assessment is to identify and evaluate the risks associated with money laundering and terrorist financing. So, if your chosen KYC provider has such a feature, it will be able to analyze different factors, including customer profiles, transaction types, and geographical locations.

7. Preventing Unauthorized Transactions

Thanks to selecting KYC software with fraud prevention, AML features, risk assessment, and other necessary features, you’ll be able to prevent any unauthorized transactions and reduce the number of malicious attempts.

8. Data Security

You must go for KYC software that has robust data security. This refers to preventing unauthorized access to confidential customer information via encrypting data. This process includes both data in transit and data at rest.

9. Pricing options

Last but not least, you should also check the price of the KYC software. Sometimes, even if you want to save money and cut down your costs, it might be wiser to go for a premium KYC software that offers all the necessary features and security aspects.

The best identity verification software providers – our detailed list

We won’t lose any time. Now that you know what to consider when choosing a KYC provider, let’s check out our detailed list of the best KYC software!

1. iDenfy ﹘ the overall best KYC software in 2024

Best for:	Compliance, Identity Verification, Identity Management
Services:	KYC, AML, Compliance Tracking, Risk Management, Document Management, Monitoring, Audit Management

iDenfy is an industry-leading KYC solution that has everything your business and your customers may need. Here’s what to expect!

Identity and Document Verification. With iDenfy, you can automatically recognize, verify, and get information from 3,000+ identity documents across 200 countries and territories. Also, advanced biometrics and face recognition ensure that all of your customers’ faces are real.

Customer Due Diligence. iDenfy helps you collect, verify, and keep data records in compliance with CDD, AML, and KYC regulatory requirements. There are also multiple solutions to layer CDD checks without disrupting the end user's experience.

AML Features. iDenfy allows you to scan and monitor your customers through multiple Sanctions, PEPs, and Watchlists. Thanks to the ongoing AML screening services, you can easily find different suspicions.

Data Security. What’s more, all of the data will stay secure due to iDenfy’s three-layer identity verification process. This KYC software comes with features like technical checks or advanced ID verification.

Fraud Prevention. Thanks to its unique features, iDenfy prevents any unauthorized access to data and documents by detecting forged and compromised documents, blocklisted, stolen, or expired documents, and a lot more.

Regulatory Compliance. iDenfy software adheres to various regulatory compliances, including KYC, AML, and even CDD. They have even implemented unique regulations for different countries.

2. Seon ﹘ AI-driven KYC solution

Best for:	Financial Fraud Detection, Financial Risk Management, Background Check
Services:	AML, KYC, Monitor User Activity In Real-Time, Analyze AI-Driven Insights

Seon is an end-to-end fraud prevention platform that runs on AI-driven insights to stop fraud before it happens. Let’s see what else it offers!

Identity and Document Verification. Seon allows you to check users in real-time and ensure all of the submitted documents are true and not spoofed.

Customer Due Diligence. Thanks to its advanced features and robust protection measures, Seon helps you collect, verify, and analyze essential information about your customer or client as a background check.

AML Features. The AML product of Seon lets you screen individuals and entities against PEPs, sanctions, relatives and close associates, crime lists, and financial watchlists. The best part is that you can even monitor adverse media events on autopilot and set up tailored monitoring rules for some people.

Data Security. Thanks to Seon’s advanced digital footprinting, device intelligence, ID verification, and real-time signals, you will be able to keep data safe at all times.

Fraud Prevention. Seon focuses on preventing any fraudulent activities, which is why it employs real-time monitoring, AI-driven insights, anti-money laundering policies, and advanced customer screenings.

Regulatory Compliance. Ultimately, Seon adheres to any regulators. From KYC and AML to GDPR, UK GDPR, and PCI-DSS, this software ensures top-notch safety and experience.

3. ID.me ﹘ KYC vendor with straightforward verification processes

Best for:	Verifying your identity across multiple websites
Services:	Community Verification, Document Verification, Identity Verification, Fraud Detection

ID.me simplifies your identity verification in over 30 states, 10 federal agencies, and 500 name-brand retailers.

Identity and Document Verification. ID.me will help you safely verify your identity or document in a few minutes. It does this through remote verification of physical IDs and mobile network operator (MNO) data, along with fraud and compliance checks.

Customer Due Diligence. Every ID.me user needs to complete extensive technical due diligence according to the AICPA SOC 2, ISO 27001, FedRAMP, and multiple NIST 800 guidelines.

AML Features. What’s more, ID.me verifies that the applicant in the background that those who apply don’t have adverse entries against both AML and OFAC lists.

Data Security. ID.me also utilizes bank-grade security infrastructure and federally-compliant information protection practices to safeguard customer data.

Fraud Prevention. By selecting ID.me as your KYC software, you’ll also be able to take advantage of their machine learning models that detect various social engineering attacks along with a layered set of consumer-facing alerts to detect, prevent, and remediate scams.

Regulatory Compliance. From FedRAMP to ISO 27001 to SOC 2 Type II, ID.me's authentication capabilities enable compliance with rigorous security regimes.

4. Onfido ﹘ automated KYC service provider

Best for:	Identity Verification, KYC, Risk Management
Services:	Document Verification, Biometric Verification, Data Verification, Fraud Detection, Onfido Studio, Atlas™ AI, Smart Capture SDK

Another of the best KYC providers is Onfido. This is an AI-powered digital identity solution built to help you know your customers online.

Identity and Document Verification. By using Onfido, you’ll be able to verify over 2,500 documents, as well as take advantage of its biometric verification features to prove your customers’ identity.

Customer Due Diligence. Its customer due diligence encompasses numerous checks so you can determine customer identities.

AML Features. Onfido’s document verification, biometric verification, ID record checks, watchlist, and ongoing monitoring will ensure a seamless AML environment.

Data Security. Onfido employs 256-bit SSL encryption at all times, and it’s also SOC 2 Type II compliant. Therefore, all data remains safe.

Fraud Prevention. Onfido allows you to prevent fraud using its award-winning document and biometric verifications, data sources, and passive fraud detection signals.

Regulatory Compliance. To ensure top-notch KYC and AML compliance, Onfido meets ETSI TS 119 461, ETSI EN 319 401, eIDAS Regulation EU 2014/910, and the UK Government's Digital Identity and Attributes Trust Framework.

5. Veriff ﹘ KYC software with robust protection measures

Best for:	Identity verification in finance, gaming, and mobility services
Services:	-

Veriff is the last identification company that seamlessly analyzes thousands of technological and behavioral variables in seconds.

Identity and Document Verification. Veriff’s identity and document verification combines AI-powered automation with reinforced learning from human feedback and manual validation. It supports over 11,500 documents from more than 230 countries and territories.

Customer Due Diligence. You can also perform background checks and other screening processes on a customer to ensure their identity.

AML Features. Veriff also allows customers to be screened against thousands of continually updated sanctions and PEP watchlists, including OFAC, UN, HMT, EU, DFAT, and more.

Data Security. Veriff implements industry-standard AES-256 encryption to encrypt data at rest and TLSv1.2+ to encrypt data during transmission.

Fraud Prevention. A unique approach is that Veriff lets you scan more than 1,000 data points, using network and device analytics to combat various fraud typologies.

Regulatory Compliance. Veriff complies with numerous AML/CTF requirements, guaranteeing you’ll prevent any fraudulent activities.

How to choose a KYC software provider?

If you want to choose the best KYC software provider, you need to focus on your specific needs. Depending on your requirements, you may want to select individual components like identity verification and biometric authentication.

Or you may be more likely to go for a comprehensive end-to-end solution that covers KYC and AML processes and ensures the integrity of your compliance program.

Another essential thing is to check the effectiveness of your chosen KYC software. To do this, it’s best if you test customer data, pay attention to the speed of manual reviews, and review the results.

Last but not least, make sure the integration process doesn’t take ages. Explore how soon the system will be integrated and how long you’re willing to wait. Also, see whether you can integrate and access your KYC software in no time to reduce both time and costs.

How can we effectively overcome key KYC challenges?

Although KYC solutions are an excellent thing for preventing fraudulent activities, there might be some challenges. So, let’s see which are the most common ones and how you can overcome them:

• High onboarding costs. KYC solutions aren’t free, and they can often be expensive. However, some of the best tips for cutting down the onboarding costs are to screen users by yourself in the beginning, employ dynamic friction, not use machine learning or AI solutions, and compare your return on investment with the value of the KYC software.
• Stringent regulatory requirements. Regulatory requirements are becoming stricter and stricter, and there are also a lot of different regulations available. Therefore, since the regulatory landscape is constantly changing, you should go for a smoothly scalable and customizable solution.
• Customer onboarding delays. Customer onboarding delays can be costly. Luckily, you can use data collection too, implement ongoing due diligence, and regularly update information. This will save you any unnecessary costs and reduce delays.
• Data privacy and security. People always doubt KYC verification as they fear their data will be misused. To avoid this, you should always be transparent, tell them why you need it, and limit it to only 24 hours.
• Technology integration. The integration of new technology into existing systems is a critical aspect of updating KYC processes. However, if you want not to waste time and a lot of money, you need to do detailed research and identify what type of technology to implement.
• Customer experience. To provide customers with a better experience, you should tend to use user-friendly KYC software that doesn’t have a complex verification process.
• Cross-border KYC. Last but not least, cross-border KYC can lead to significant payment delays and bigger taxes. Also, this can cause a higher degree of fraudulent activities. To avoid this, you can implement KYC-AML utility models that will provide banks with all the necessary details instead of asking customers directly.

Best KYC vendors: Final Recommendations

KYC verification is crucial for ensuring your customers are who they claim to be and prevent any fraudulent activities. Therefore, if you’re looking for a great KYC solution, you should check out the best KYC software ﹘ iDenfy.

iDenfy comes with unique features and services, such as AML, compliance tracking, risk management, document management, monitoring, and audit management, which makes it suitable for numerous industries. Even though its pricing model is a bit complex, this doesn’t present a significant issue.

FAQ