Money, sales tax and addresses · A term for founders abroad
What is KYC?
know your customer, know your business. The identity checks banks and processors must run: KYC on the people behind an account, KYB on the company itself.
Checked against the IRS's instructions and the states' own rules. Reviewed by Saais Patel, compliance reviewer.
Term 61 of 105 in the glossary, filed under K.Every term, A to Z
KYC and KYB, for a founder abroad.
Banks and payment processors are required to know who their customers are. KYC checks the person opening the account and every owner of 25% or more, usually with a passport, often a live selfie, and proof of address. KYB checks the company: its formation document, its EIN and what it does.
They compare your answers with each other and with your website, so consistency is most of the test. Checks continue after the account opens: more volume, a new country or a new kind of customer can bring a request for documents. Answer it fully and quickly, and the question closes.
What founders ask next.
- Why does my bank keep asking for documents?
- Because its rules require it to understand changes in your activity. The KYC guide lists what triggers a review and how to answer.
- Does the end of BOI reporting change KYC?
- No. Banks still identify every owner of 25% or more under their own rules.
03 · See also
- Money, sales tax and addressesChargebackA card payment reversed by the customer's bank at the customer's request, with a fee to the merchant and a mark against its record.Read the term
- Keeping the company in good standingBeneficial ownership reportThe FinCEN filing that named a company's owners under the Corporate Transparency Act, permanently ended for US-formed companies in August 2026.Read the term
- Money, sales tax and addressesNexusThe link with a state that obliges a seller to collect its sales tax, created by a presence there or by sales above the state's threshold.Read the term
- Money, sales tax and addressesEconomic nexusSales into a state above its threshold, usually $100,000 a year, which makes a seller elsewhere collect that state's sales tax with no presence there.Read the term
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