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The KYC & AML Glossary

Plain-English definitions for onboarding and compliance teams.

Compliance is full of acronyms. This glossary explains the core concepts behind customer onboarding, due diligence, and anti-money-laundering — what each term means, why it matters, and how it fits into a real onboarding workflow.

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KYC (Know Your Customer)

Verifying a customer's identity and risk before and during a relationship.

AML (Anti-Money Laundering)

The framework of laws and controls that detect and prevent money laundering.

KYB (Know Your Business)

Verifying a business entity and the people who own or control it.

Customer Due Diligence (CDD)

The risk-based process of identifying customers and assessing their risk.

Enhanced Due Diligence (EDD)

Deeper checks applied to higher-risk customers and relationships.

Politically Exposed Person (PEP)

An individual with a prominent public function and elevated risk.

Sanctions Screening

Checking parties against government and international sanctions lists.

Ultimate Beneficial Owner (UBO)

The natural person who ultimately owns or controls a company.