Finance glossary
Know Your Customer — KYC
Also known as: KYC
In simple terms
Know Your Customer is the checking firms must do to confirm who you are before opening an account or providing services — part of the fight against fraud and money laundering.
On this page
What does Know Your Customer mean?
Know Your Customer (KYC) is the process financial firms use to verify your identity and understand your circumstances before, and during, a business relationship. It is a key part of anti-money-laundering rules.
It is why you are asked for ID and proof of address when opening accounts.
How KYC works
Firms collect and verify information such as your name, date of birth and address, often using documents or electronic checks, and may ask about the source of your funds for larger transactions. They must keep this up to date and monitor for unusual activity.
These duties come from UK money-laundering regulations.
How could this affect me?
KYC checks can feel intrusive, but they protect the system — and you — from fraud and financial crime. Providing clear, accurate documents helps applications go smoothly.
A genuine firm will use secure channels; be wary of anyone using “verification” as a pretext to extract your details by phone or email.
Things to watch out for
- Fraudsters imitate KYC checks to steal your details — use only official channels.
- Out-of-date ID or address details can delay applications.
- Firms may ask about the source of larger funds — this is normal.
Know your rights
- KYC and identity checks stem from UK money-laundering regulations that firms must follow.
- Your data is protected under UK GDPR / Data Protection Act 2018, giving you rights over how it is used.
General information, not personal advice
Consumer Credit is an independent information service. We do not provide regulated financial advice or sell financial products. For advice on your own situation, speak to an appropriately authorised firm or a free service such as MoneyHelper. About Consumer Credit.
Sources
We checked this page against these official and authoritative sources.
- GOV.UK, Money laundering regulations (opens in a new tab). Accessed 22 Aug 2026.