What is KYC and Why is it Important in Finance?

 What is KYC and Why is it Important in Finance?

 I'm setting up a new bank account and keep seeing references to KYC. What does KYC mean, and why do financial institutions require it?  

KYC stands for "Know Your Customer." It is a regulatory and security process implemented by banks, financial institutions, and various businesses to verify the identity of their clients. The purpose of KYC is to prevent identity theft, financial fraud, money laundering, and terrorist financing. By requiring customers to provide valid identification documents and sometimes additional information about their source of funds or business activities, institutions can ensure a safer financial environment and comply with legal regulations. KYC also helps companies understand their customers better and manage risks prudently. For more comprehensive information on KYC, its procedures, and its significance in financial operations, this article can be very helpful: https://paybis.com/blog/glossary/what-is-kyc/  It explains the KYC process in detail and discusses its impact on both consumers and financial institutions.