KYC (Know Your Customer)

Introduction

KYC is a regulatory obligation for Payment Institutions, as per the European Directive 2015/849 of the European Parliament and the Council of May 20, 2015, on the prevention of the use of the financial system for the purposes of money laundering and terrorist financing.

While it might seem restrictive at first, it should be at the heart of your business concerns and can become a key competitive advantage as it dramatically helps reduce fraud as well as reprehensible behaviors on your platform.

KYC Guidelines

How to do a successful KYC

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Warning

We accept KYC documents in French, English, Spanish, Italian and German. For
other countries, we require official translation in one of the above language.

Document rejected: what you should do

Our KYC experts always explain why a KYC document was rejected in the notes of the relevant document.

To retrieve this comment use the API call Get documents associated with a payment account. See our dedicated API documentation

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Note

You can read this comment on your Dashboard. This is only visible to you, not your end-user.

KYC Implementation

Primary and Secondary

Primary proof of identity (physical person)

  • ID Card
  • Passport
  • Driving Licence (with MRZ lines)
  • Residence Permit (card format)

Secondary proof of identity (physical person)

  • Family Booklet (Livret de famille- only France)
  • Tax Notice

Front Screen

βœ”οΈ Do

In the Proof of identity 1 list, display only 3 primary documents. Ensure that the remaining 2 primary documents are listed in the Proof of identity 2 lists.

❌ Don't

Do not impose choices on your users for proof of identity 2. They might find themselves blocked.

🚧

Warning

Not all users have a secondary proof of identity.

API Code

βœ”οΈ Do

Be precise with Document Type numbers as they are linked to a specific proof of identity documents to ensure a successful analysis and our SLA.

❌ Don't

Do not mismatch a Document Type number with a different proof of identity document, we will not be able to process it correctly and clear the KYC.

Uploading document both sides

βœ”οΈ Do

Ensure that your users capture both the front and back of their documents in 2 steps.

❌ Don't

Do not impose that your users capture both front and back in 1 step, they might find themselves blocked.


βœ”οΈ Do

Merge both sides of the created document in one file before sending them to us using our API.

❌ Don't

Do not send the front and back of a document as two separate files. We need to review them as one file.


βœ”οΈ Do

Upload one file per document.

❌ Don't

Do not upload several documents in one file.

Classic Validation

Quality Control

For all documents:

  • Documents must be scanned on both sides and merged to form a single document
  • Documents are valid only in colour and must be scanned in the right direction
  • Documents must be perfectly legible, no glare, not damaged or dirty
  • Blurry, pixelated or cropped documents will be refused
  • MRZ lines must be readable and complete:
  1. If user in a country with national ID cards and driving licence with MRZ line, Authorized ID is National ID or Passport or Driving Licence (with MRZ line
    required), e.g. France
  2. If user in a country with national identity cards, but no driving licence with
    MRZ line
    , Authorized ID is National ID or Passport, e.g. Sweden, Finland
  3. If user in a country without national identity cards and without driving licence
    with MRZ line
    , Authorized ID is Passport or Driving Licence (without MRZ line), e.g. UK and Denmark

Validity Check

For all documents:

  • Expiration control, documents should not be expired

Technical recommendations

For all documents:

  • Documents formats accepted: jpg, jpeg, png, and pdf
  • Minimum size: 100Kb, maximum size: 4Mb

Automatic validation of documents

Documents with automatic validation (OCR technology):

  • ID Card
  • Passport
  • Residence Permit
  • Driving licence

Our OCR Technology scans all ID documents and validates

If the document is eligible but fails automatic validation

The end-user has 3 attempts to upload documents. If these uploads fail(rejected), a manual validation is done by a KYC Analyst.

βœ”οΈ Do

Explain clearly the reason the document did not meet the quality control and validity check requirements.

The user can re-upload documents twice before manual verification is done by a KYC analyst.

❌ Don't

Don’t give a vague refusal message, this might create friction with your user.

Statuses

  • Received, waiting to be processed: the default status of a new document,
    meaning it has not yet been processed by our KYC experts
  • Accepted: when the document is approved/accepted (when all the
    documents in a payment account have been accepted but there are documents
    missing, the payment account will remain on KYC1)
  • Illegible: when the document provided is incomplete or of too poor quality
    to be understood by our KYC experts
  • Expired: when the document is no longer valid (expired ID, etc.)
  • Wrong type: when the document provided is not the one expected (e.g. a
    driving licence instead of an ID card or passport)
  • Wrong recipient: when the holder of the payment account does not
    correspond to the person named in the document concerned
  • On hold: when the document review is put on hold by a KYC team member

Webhook / Notifications

Accounts

Lemonway recommends that you activate the notification from the Dashboard. This will enable you to monitor updates on your accounts.

Wallet status change, see our API doc

Documents

Lemonway recommends that you activate the notification from the Dashboard. This will enable you to monitor updates on your documents.

Document status change, see our API doc

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Note

Notifications can be received by email (HTML format) or sent
to an information system (webhooks / callbacks through HTTP POST or
GET).

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Note

It can take up to one hour to send a notification.


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