A retail trader who opens a live account with a passport photo and a selfie has passed KYC, Know Your Customer. A company opening a corporate trading account, or an introducing broker being paid commission on client volume, has to pass a different check: KYB, Know Your Business, which verifies the company itself and the people who own and control it. The two checks answer different questions, use different data sources, and a trading firm that only builds one of them has a gap the other was meant to close.
What KYC checks
KYC verifies a natural person. The standard flow: a government-issued ID (passport, driving license or national ID card), a selfie matched against the photo on that document, and a liveness check confirming a real person is present rather than a photo of a photo or a synthetic face. Some flows add proof of address and screening against sanctions and politically exposed persons lists. This is the check every retail trader passes before funding a live account, on any platform.
What KYB checks
KYB verifies a legal entity, not a person. It typically covers a corporate registry check confirming the company exists and is in good standing, an ownership and control check mapping who sits behind it, identification of the ultimate beneficial owners, the individuals who actually own or control the business (commonly defined around a 10 to 25 percent ownership or voting threshold), verification of the directors and authorized representatives, and a review of incorporation documents. AML screening usually runs against the business and its named individuals together, rather than the company name alone.
Why a trading firm needs both
Retail traders funding a personal account only ever need KYC. A trading firm still needs KYB the moment it deals with anything that is not a natural person trading its own money: a corporate or professional client trading through a company account, an IB or affiliate entity being paid commission, a fund or money manager running MAM or PAMM allocations on behalf of investors, or any counterparty a firm's AML policy treats as a business relationship rather than an individual one. Skipping KYB on these relationships is a common gap: the individual signing the paperwork passes KYC, but nobody verifies the company behind them or who actually controls it.
Vendors that offer both
Not every identity vendor builds KYB as a first-class product. Three that publish both KYC and KYB on their own sites:
| Vendor | KYC (individual) | KYB (business) |
|---|---|---|
| Sumsub | ID verification, proof of address, liveness detection, non-doc verification | Corporate registry checks, ownership and control checks, UBO verification, corporate document review |
| Veriff | Document verification, passive liveness detection, face matching, proof of address | Business Verification across 300+ jurisdictions; directors, shareholders and beneficial owners |
| Trulioo | KYC Data and KYC Documents, electronic ID, global bank verification | KYB Verification across 500+ registration formats, AI-driven UBO Discovery |
Other vendors specialize on one side of the line. Jumio's published product set centers on individual identity verification and AML screening rather than a dedicated KYB line. Middesk goes the other direction entirely: it is a business-only KYB platform, drawing on more than 400 government and authoritative sources to verify a company and map its ownership network, built to sit next to whichever KYC vendor a firm already runs rather than replace it. Our Veriff vs Jumio guide compares two KYC-first vendors head to head, and Sumsub alternatives organizes the wider field by use case, KYB included.
Running KYC and KYB from separate vendors
A firm does not have to get both checks from the same company. A common pattern is a KYC vendor handling retail onboarding, with a dedicated KYB tool like Middesk layered in only for the accounts that need it: IB entities, corporate clients and money managers. That keeps the retail flow simple while giving business relationships the deeper check they need under most AML policies. The trade-off is two vendor relationships and two data flows into the CRM instead of one, which is a fair reason for a firm to prefer a vendor that covers both checks if its business-account volume is high enough to justify the switch.
How this connects to onboarding and CRM
Whichever combination a firm lands on, the check has to feed the CRM that opens the account. SGHK's Broker CRM and Prop Firm CRM integrate any KYC provider by API, which covers a business-verification vendor the same way it covers a personal identity vendor: the CRM does not care which check a given API call represents, only that the account is not opened until it clears. See broker KYC compliance for how the check fits into a firm's wider onboarding obligations, and AML policy for brokers for how KYC and KYB feed into a firm's written AML policy.
Start by mapping which of your account types are natural persons and which are entities. Retail live and demo accounts need KYC. Anything with a company name on the application, an IB agreement, or a money-manager role needs KYB on top. Pick vendors, or a single vendor, that cover both without leaving either gap open.
"The trader signing the form is not always the party you need to verify. If a company sits behind the account, checking the person is not enough."
— The SGHK Team
Key Takeaways
- KYC verifies a natural person with an ID, a selfie and a liveness check. KYB verifies a legal entity: its registry status, its ownership structure and its beneficial owners.
- Retail traders funding a personal account only need KYC; corporate clients, IB and affiliate entities, and money managers need KYB as well.
- Sumsub, Veriff and Trulioo publish both KYC and KYB on their own sites; Middesk is a dedicated business-only KYB layer for firms that want to add it next to an existing KYC vendor.
- SGHK's Broker CRM and Prop Firm CRM integrate any KYC or KYB provider by API, so a firm can run one vendor for both checks or split them across two.
Frequently Asked Questions
What is the difference between KYC and KYB?
KYC verifies an individual person with a government ID, a selfie and a liveness check. KYB verifies a business: its registration status, its ownership structure, its directors and its ultimate beneficial owners. A trading firm needs KYC for every retail trader and KYB for any account that is a company rather than a person.
Does a prop firm need KYB, or only KYC?
A prop firm needs KYC for individual traders funding evaluation and funded accounts. It needs KYB as well for anything that is not an individual: an affiliate entity earning commission, a corporate client, or a fund trading through the firm on behalf of others.
Which vendors offer both KYC and KYB?
Sumsub, Veriff and Trulioo each publish both individual identity verification and business verification on their own sites. Middesk is a business-only KYB vendor built to run alongside a separate KYC tool rather than replace one.
Can a firm use two different vendors for KYC and KYB?
Yes. A common setup pairs a KYC vendor for retail onboarding with a dedicated KYB tool like Middesk layered in only for business accounts, IB entities and money managers, at the cost of managing two vendor integrations instead of one.
Does SGHK's CRM support KYB checks as well as KYC?
Yes. The Broker CRM and Prop Firm CRM integrate any KYC or KYB provider by API, so business verification checks feed account opening the same way personal identity checks do.
About SGHK
SGHK is a FinTech company that designs and builds its own software for the trading industry: the eTrader trading platform, Launch your Broker and Launch your Prop Firm. Every product is written, hosted and supported in-house and licensed to trading firms, with the CRMs branded to them, all hosted by us in the cloud, managed by each firm and built to scale across clustered servers as our clients grow. Everything is encrypted, and each firm is the only one with access to its data and its clients' data.