Synonyms:
What Is (KYC) Know Your Customer
Background Verification, formally known as KYC (Know Your Customer), is an identity verification process required by governments or regulatory bodies. It is widely used in highly regulated industries such as finance, payments, cryptocurrency, and gambling. The purpose of KYC is to ensure that platforms can identify and verify the true identity of their users in order to prevent money laundering, financial fraud, terrorist financing, and illegal transactions.
KYC in the Gambling Industry
On licensed gambling platforms, KYC is a mandatory compliance procedure. All licensed operators are required to conduct KYC checks on users, as it is one of the most basic regulatory requirements enforced by licensing authorities such as MGA, UKGC, and Gibraltar.
Key Scenarios Where KYC Is Applied:
Identity verification during user registration
Document verification before a player’s first withdrawal
Additional checks during high deposits, suspicious activity, or triggered risk alerts
Age verification (to prevent underage gambling)
Common KYC Documents
| Verification Type | Possible Required Documents |
|---|---|
| Proof of Identity | Government-issued photo ID such as a passport, national ID card, or driver’s license |
| Proof of Address | Utility bills, bank statements, or official proof of residence (issued within the last 3 months) |
| Payment Method Verification | Photo of linked credit card, screenshot of payment account |
| Proof of Source of Funds | Bank deposit slips, payslips, or tax records (especially for high-value users or AML screening) |
The Relationship Between KYC and Players
| Benefit | Explanation |
|---|---|
| Enhanced Platform Security | Prevents fake accounts, fraud, and money laundering. |
| Better Protection of Funds and Personal Data | Ensures players’ assets and information are protected under legal frameworks. |
| Required for Withdrawals and Settlements | Accounts that fail KYC verification are usually not allowed to withdraw funds. |
| Prevention of Underage Gambling | Age verification is a core part of KYC procedures. |
Why Must Licensed Gambling Platforms Conduct KYC?
To comply with licensing requirements from regulators such as MGA, UKGC, and Curaçao CGA
To align with international AML (Anti-Money Laundering) and CFT (Countering the Financing of Terrorism) regulations
To reduce legal risks and potential fines
To build brand trust and ensure user loyalty and stable cash flow
What Happens If a Platform Doesn’t Implement KYC?
Player accounts may be exploited for illegal fund transfers, putting the platform at risk
Regulatory bodies may revoke the license and issue significant fines
Player funds and data are unprotected, making legal recourse difficult
Most payment providers (e.g., Visa, Mastercard, Astropay) will refuse to cooperate with the platform