About Enhanced Due Diligence
Enhanced Due Diligence is used for investigating and assessing the risk factor for an individual and it is an advanced form of KYC due diligence. With Enhanced Due Diligence banks and financial institutions can easily manage high-risk clients along with the huge tr̥ansactions. Click here to know more about Enhanced Due Diligence.
For the banking and financial industry handling dubious transactions and high-risk customers involve major risks and Customer Due Diligence or CDD is not capable of distinguishing these kinds of transactions or clients.
That is why companies need to make use of the Enhanced Due Diligence process to evaluate the identity, address, and risk category of the customer. EDD can significantly lower the chances of terror financing, and money laundering by conducting a thorough investigation of every individual customer as well as transaction.
When Enhanced Due Diligence is required?
- If your company is conducting business with the individuals and organizations mentioned below, then you will have to use Enhanced Due Diligence for securing your company or organization:
- Blacklisted companies that have previously funded terrorist activities
- If you are conducting business in a country that is on the list of High-Risk Third Countries
- Shell companies
- PEP or Politically Exposed Persons along with their family members
- Private banking or correspondent banking
- Companies who are related to money laundering sectors such as gambling
Top advantages of Enhanced Due Diligence
Although a lot of people think that Enhanced Due Diligence is mainly used for preventing frauds as well as verifying identities, it incorporates other benefits as well. Let us discuss some of the main advantages of using Enhanced Due Diligence in your company or business:
1. Enhance your customer experience with EDD
To completely verify the identity of every individual customer a company will require loads of information which is also the basis of Enhanced Due Diligence. The available information on the customer can not only help you in authenticating the identity of your client but it will also assist you in offering better services to your customers by incorporating their preferences into your services.
2. Carry on being a clean company
With the help of Enhanced Due Diligence, you will be able to avert illegal money from entering the ecosystem of your company or businesses. You can maintain all-white transactions that every company dreams to achieve with the help of Enhanced Due Diligence because EDD not only verifies every individual customer but all the people associated with them. Use EDD to avoid money laundering and other financial crimes.
3. Become a credible company
Enhanced Due Diligence can also help to create a positive brand image that is impactful in the corporate industry and creates a positive social image of the company. Every other company and business will put their trust in you because your company can rigidly observe every transaction.
4. Protect yourself from Fraudulent Schemes
The benefits of Enhanced Due Diligence are not limited to the fact it can prevent money laundering. You can also protect your company from terror financing or account hijacking. Therefore you can solely focus on growing your company and businesses because EDD is protecting you from fraud and monitoring suspicious activities.
The best part about Enhanced Due Diligence is that it can help banking and financial institutions avoid and manage high-risk transactions as well as clients at every step. Enhanced Due Diligence verifies every transaction with complete preciseness without overlooking the minute details of the transactions.
A part from vigorous identification checks it also has other major benefits such as making your company or business trustworthy and reliable for other companies and consumers. Enhanced Due Diligence can ensure that all the crimes related to finance are in check.