Global KYC: Navigating challenges across borders

Technology enables companies to perform KYC on a global scale, reducing the risk of fraud and improving security.

June 25, 2024

Tom Sullivan Pic
Tom Sullivan

Tom is a fintech industry writer who creates whitepapers and articles for Plaid. His work has been featured in publications like Forbes, Fortune, and Inc. He's passionate about the freedom that the union between financial services and technology can create.

KYC (know your customer) regulations are crucial to limiting money laundering and other illicit activities that threaten the integrity of the financial system. However, achieving effective KYC on a global scale can be extremely challenging.

While a US company digitally verifying users from another country may not be subject to foreign KYC rules, factors like differences in data requirements, data formatting, language, and technology access can complicate the verification process for non-US users. 

Luckily, technology solutions are making it easier for financial institutions and fintech companies to expand their global market while remaining KYC compliant and delivering a positive user experience. Before discussing how technology is streamlining the process, it's helpful to gain a comprehensive view of the challenges. 

How do KYC regulations vary globally? 

KYC (Know Your Customer) regulations are intended to protect financial services companies and the economic system at large from bad actors who seek to commit fraud or identity theft, launder money, or finance terrorist organizations. 

While the specific regulations vary by country and territory, the core goal remains the same—to ensure people are who they say they are when opening bank accounts, applying for loans, or moving money between accounts. 

A strong KYC program generally includes the ability to verify customer identity, assess risk, conduct due diligence, and perform ongoing monitoring. This is difficult to implement globally due to differences in government-issued documents, diverse address formats, and language barriers. 

For example, a US-based investment app may be able to verify government IDs from the 50 states; however, it could be limited when verifying potential customers from Latin America, Canada, or elsewhere without understanding the differences in languages and ID cards. 

The challenges of a truly global KYC program often limit timely access to financial tools and resources. They also limit fintech companies' customer base. Understanding the challenges of global KYC is the first step to finding a solution.

Challenges of global KYC by region 

The core challenge of global KYC for predominantly US-based companies is the diversity of ID documents, UX, and data formatting challenges. The most effective way to understand these challenges is to review the regional differences. While there may be dozens of countries in these regions, there are shared trends worth considering. 

Europe & UK

The European Union has adopted robust legislation to fight money laundering and terrorist financing in the financial service industry. While this may not be an issue for companies without local branches, there is another challenge at work—the EU has 24 official languages and no standard ID card. 

While there have been efforts to standardize EU identity cards, there are currently 86 different versions of identity cards and 181 types of residence documents. The UK currently has no national ID program

To expand into the EU and the UK, fintech companies need to find ways to navigate the different languages and ID card requirements to ensure compliance with KYC regulations. 


The Asia-Pacific region offers fintech companies several challenges. First, there is no consensus on the number of countries in the region. APEC, for example, has 21 member states, including both the Philippines and Russia, while the Federal Aviation Administration lists nearly 40 countries in the region. Additionally, the region includes countries like India, which has 22 official languages—and hundreds of non-official languages. 

Technology usage also varies across Asia-Pacific countries, which may impact user experience or limit access. For example, while Japan and China are very technologically advanced, in Cambodia, nearly 30% of people are not online.

Mobile phone quality and network access can affect the digital KYC process. For example, poor camera image quality and slow network speed can hinder verification when performing a phone selfie verification. 

Financial institutions must navigate these differences and invest in technologies that meet the needs of a diverse population. 

Latin America (South America, Central America, and the Caribbean)

The Latin American region contains multiple regulations and economies spread over a large and diverse area. KYC challenges arise when considering the different risk profiles, IDs, and languages. 

In 2023, Haiti had the highest risk of money laundering and terrorist financing, with a Basel AML index score of 8.25. Nicaragua ranked second, with 6.42 points, while Uruguay had the lowest risk in the region with a score of 4.08. These varying risk profiles add a layer of complexity that financial organizations may need to consider. 


Africa presents several challenges in global KYC. In addition to being home to over a billion people, the continent is made up of more than 50 countries and several territories. 

Africa is a diverse continent with a number of countries and economies, making global KYC challenging due to the number of languages and identity documents from various countries. Another challenge in Africa is the percentage of people who don't have identity documents.

Tech infrastructure presents another issue for digital KYC. Some African users may be unable to submit selfie videos for KYC due to low network connectivity. Users with older mobile phones or low connectivity may have to provide a still image instead of a selfie, which may be reviewed as a higher potential for fraud or may not always provide the best quality image for verification. 

Companies looking to offer financial services in this region will need to adjust to the region's various languages, tech infrastructures, and ID documentation limitations. 

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How Plaid solves international KYC challenges

Plaid Identity Verification is a global KYC platform designed to verify identity data, verify that IDs are in the proper format, IDs, and confirm liveness. It helps fintech companies and other organizations limit their risk and stay compliant with KYC and AML regulations. 

Plaid Identity Verification enables global KYC in several ways, including: 

  • Supports 16,000+ ID types from 200 countries and territories: Verify more ID types, including rarer ID documents such as permanent residency cards and temporary visas.  

  • Supports PII (personal identifying information) in varied formats: The data gathered for KYC can vary by location; for example, addresses are often formatted differently across countries. Plaid IDV accounts for these data differences. 

  • Localized UX: Plaid IDV makes it simple to launch into new countries with just the check of a box. The verification user interface is localized by location and dynamically updates to ask customers for their social security number, national insurance number, or social insurance number, depending on the country.

  • Available in several languages: Plaid Identity Verification can be used in English, Spanish, French, Portuguese, and Japanese.

Plaid IDV reduces fraud losses while prioritizing user experience. By providing a no-code solution for global KYC, Plaid helps companies serve customers in a wide range of locations without increasing fraud risk levels. 

→ Learn more about Plaid’s fraud and compliance solutions.

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