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  2. What Is the Know Your Customer (KYC) Process All About?

What Is the Know Your Customer (KYC) Process All About?

Singapore has always gone the extra mile to protect its financial and business systems from any money laundering or terrorist financing regimes. In 2015, the government strengthened this protection by bringing Corporate Service Providers like Osome under a regulatory framework that requires them to monitor and report any activities that could be harmful to Singapore’s financial systems through Know-Your-Customer (KYC) due diligence.

It is a compulsory step for corporate service providers like Osome to screen companies that want to incorporate in Singapore using our service. If you want to safely incorporate your company in Singapore, reach out to us.

What is KYC?

KYC, or Know Your Customer, is a set of processes and tools created to help banks, financial establishments, corporate service providers, and vendors to gather and verify information about their customers against several public record databases.

Usually, the process requires customers to provide proof of identity and proof of address along with a recent photograph.

What is the KYC Process like?

KYC can be done via online or offline channels:

Offline

You download an onboarding application, fill in the details in a hard copy physical document, sign the required document and submit it along with copies of the required paperwork in-person or via mail.

This manual method done by traditional corporate service providers is heavily dependent on manual tasks such as data sorting, data entry, error-rectification and approvals, resulting in more errors and remediation costs. The manual nature of KYC means that companies can spend over a month on KYC compliance for a single customer. This would mean it could take up to weeks and even up to over a month for some clients to open companies.

Online

You, fill in the details required in an online form given by your corporate service provider & uploads the required documents. The documents are verified by manual reviewers who will correspond with the customer to finish the process.

Faster KYC checks with Osome

Our screening process is powered with Artificial Intelligence (AI) and is one of the fastest, and most secure around. Although end-to-end KYC processing still requires our experienced Compliance Team to make high-level decisions, a majority of the manual legwork can be handed off to automation.

Using AI, we’re able to extract data from documents and reduce screening, identification and verification times. This is how we’re able to help our clients open companies in Singapore quickly. Our record is within an hour when all documents are in order.  

Why is KYC important and what does this mean for company owners?

If you are planning to open a company in Singapore, you would need to go through the screening and comply with the KYC guidelines.

Through this process, the integrity and reputation of your Singapore-based company will be protected. The KYC process is important to ensure that clients do not engage in business activities which could possibly harm your company’s reputation, or that of Singapore or our clients’ home countries as well.

Ken wishes to open a startup in Singapore and approaches Osome, a Singapore Corporate Service Provider company to help with his company’s incorporation. Osome has to get detailed information from Ken about his company and go through a screening process before agreeing to assist him. Once Osome has enough information, they may start to help him incorporate his company.

What documents do I need to prepare for KYC?

You would need to prepare different sets of documents for your director, individual shareholders, and corporate shareholders. You will also need to submit your company documents.

KYC documents for my Director

Depending on the situation of your director, these KYC documents are needed but not limited to:

My director is...
A Singapore Citizen or Permanent Resident A Foreigner A Foreigner holding a Singapore work pass
  • Full name, email address and telephone number
  • Singapore NRIC (photo/scan of front and back of card)
  • Full name, email address and telephone number
  • Passport (photo/scan of ID pages)
  • Residential address proof issued within the last three (3) months
  • Full name, email address and telephone number
  • Singapore DP/EP/PEP/EntrePass (photo/scan of front and back of card)
  • Passport (photo/scan of front and back of card)
  • Residential address proof issued within last three (3) months

Take note:

  1. Documents submitted should not be more than 3 months old and must be in English or otherwise translated into English by a certified translator.
  2. Valid address proofs include utility bills, bank statements or tax records issued by institutional authorities.
  3. To send your KYC documents to Osome, simply upload each document to the Osome app or web platform
  4. AML and KYC regulations are subject to change and additional documents might be requested on a case-by-case basis

KYC Documents for individual shareholders of my company

Depending on the situation of your individual shareholder, these documents are needed:

My individual shareholder...
A Singapore Citizen or Permanent Resident A Foreigner A Foreigner holding a Singapore work pass
  • Full name, email address and telephone number
  • Singapore NRIC (photo/scan of front and back of card)
  • Full name, email address and telephone number
  • Passport (photo/scan of ID pages)
  • Residential address proof issued within the last three (3) months
  • Full name, email address and telephone number
  • Singapore DP/EP/PEP/EntrePass (photo/scan of front and back of card)
  • Passport (photo/scan of front and back of card)
  • Residential address proof issued within last three (3) months

KYC documents required for my corporate shareholders

Depending on which jurisdiction the company is incorporated, the KYC documents required for your corporate shareholder would be different. These are some of the documents that may be asked of you:

  • Certificate of Incorporation/Registration or equivalent company formation document showing the date and place of incorporation
  • Business Profile/Certificate of Incumbency or equivalent company registry record with a list of directors & shareholders and registered office address
  • Certificate of Appointment of Corporate Representative and Directors’ Resolution in Writing (required only where a corporate representative has been appointed)
  • Passport/NRIC and proof of residential address (issued within last three months) for each individual who owns or controls the corporate shareholder

Other documents may also be requested on a case-by-case basis.

3 Tips to make it easier for you to clear the KYC screening

Here’s how you can help your service providers to clear things faster.

1. Be readily available and always remain in contact with your corporate service provider

Ken’s company WeProvide engages with a corporate service provider. They have been asking Ken for information on Ken’s company, including the motive for starting his business, what kind of activities the company engages in for-profit, the type of clients he deals with, and accounts he uses for transactions. Ken replies within the hour and works with all the requests by his corporate service provider such as arranging for a video call to verify his identity. He gets his company incorporated within a few hours.

2. Clear copies of the documents

Make sure the documents that you send over to your service provider are not blur, and do not accidentally crop off the details. Use apps like CamScanner on your phone to help you with this.

3. Clear business description

A clear description of your business includes a summary of what your company does, and what its scope is.

Your business description should answer the following questions:

  • What is your business name?
  • Who owns the business?
  • Who are you selling to?
  • What product or service are you selling?
  • How are you structuring your company?

Incorporating with Osome

When you register your company with Osome, the KYC process will be as efficient and thorough as possible. Furthermore, you would not need to be physically present for your Singapore company registration. You don’t have to visit a lawyer or any government official to certify true copies of an identity card or passport. Hence, physical presence is not required with our software.

It is important to keep in line with the country’s regulations and laws when trying to incorporate your company. Having the required documents on hand, being truthful in your transactions and choosing the right corporate service providers like Osome for your company registration will help you to speed up your company incorporation process. Osome also provides assistance with company registration for foreigners in Singapore.


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