KYB (Know Your Business) vs KYC: What’s the Difference in UAE AML?

Introduction

In the world of Anti-Money Laundering (AML), few acronyms cause more confusion than KYB and KYC. They sound similar, and in many ways, they are. But in the UAE’s AML framework, understanding the difference between Know Your Business (KYB) and Know Your Customer (KYC) is more than just a technicality, it's critical for compliance, especially when onboarding corporate clients.

So, what exactly sets them apart? And how do you apply each in real-world scenarios?

Let’s break it down clearly, UAE-style.

What is KYC?

KYC (Know Your Customer) is the process of verifying the identity of individual clients. In the UAE, this includes:

• Validating a customer's Emirates ID or passport
• Confirming residency status
• Assessing risk level based on occupation, nationality, transaction purpose, etc.
• Screening the person against sanctions and PEP lists
• Understanding the source of funds (for high-risk clients)

KYC applies primarily when you deal with natural persons, individuals acting in their own capacity.

What is KYB?

KYB (Know Your Business), on the other hand, is the process of verifying the identity and legitimacy of legal entities, companies, trusts, partnerships, or other business structures.

In the UAE, KYB includes:

• Collecting trade license, Memorandum of Association (MOA), or Articles of Incorporation
• Identifying the Ultimate Beneficial Owner (UBO), required by Cabinet Resolution No. (58) of 2020
• Confirming authorised signatories
• Verifying ownership structure
• Understanding the nature of business, risk level, and transaction patterns
• Checking the business against sanctions, PEP associations, and other risk factors

KYB vs KYC: Key Differences

• Subject
• • • KYC: Natural person (individual)
    • KYB: Legal entity (company, trust, etc.)
• Purpose
• • • KYC: Verify personal identity and assess risk
    • KYB: Verify business legitimacy and ownership structure
• Documents Required
• • • KYC: Passport, Emirates ID
    • KYB: Trade license, MOA, UBO declaration
• Screening Focus
• • • KYC: Sanctions, PEP, nationality
    • KYB: Sanctions, PEP associations, country of registration
• Complexity Level
• • • KYC: Relatively simple
    • KYB: Often multi-layered, involves identifying UBOs

When Do You Apply KYB in the UAE?

You apply KYB whenever you’re onboarding a corporate client, including:

• Real estate companies
• Holding companies
• Offshore entities
• Any business engaging in high-value transactions

It’s not enough to stop at the trade license. You must dig deeper and identify the people who ultimately control or benefit from the entity, this is the core of KYB.

How KYB and KYC Work Together

Most DNFBPs will use both KYC and KYB in tandem. For example:

You onboard a corporate buyer for a property.

• You do KYB on the company (verify trade license, structure, and UBO).
• Then you do KYC on the UBO and authorized signatory (passport, ID, PEP screening).

You can’t skip either, regulators expect both layers to be documented clearly.

Best Practices for UAE DNFBPs

• Always collect the UBO declaration form, even if the ownership appears straightforward
• Keep KYC and KYB documentation separate but linked in your records
• Document risk scoring and due diligence actions clearly in your AML system
• Rescreen UBOs periodically, especially for high-risk clients
• Red flag shell companies or complex structures with unclear UBOs

How InfoAML Helps

InfoAML is designed to streamline both KYC and KYB:

• Custom fields for UBO and business structure
• Automated document reminders
• Integrated screening for individuals and entities
• Risk scoring that adapts to client type

Whether you’re onboarding individuals or companies, InfoAML ensures you’re compliant, and ready for inspections.

Conclusion

KYC and KYB are two sides of the same coin, both essential to fighting money laundering in the UAE. Knowing when and how to apply them correctly can mean the difference between smooth compliance and costly fines.

So the next time a client walks in with a business card and trade license, don’t stop there. Ask who’s really behind the company, and make sure you document every step.

Looking for KYB/KYC Software Built for UAE Compliance?

InfoAML simplifies customer onboarding with KYB automation, UBO tracking, and smart risk scoring, all aligned with UAE regulations.

👉 Request a free AML software demo today and see how InfoAML can streamline your compliance process from day one.