Know Your Seller (KYS)

🔹 Definition

Know Your Seller (KYS) is the process of verifying the identity, legitimacy, and compliance risk of individuals or entities who offer goods or services on a digital platform, marketplace, or e-commerce site. KYS is especially important for online marketplaces, payment platforms, logistics providers, and B2B platforms to ensure sellers are trustworthy, authorized, and not involved in fraudulent or illegal activity.

KYS strengthens platform integrity, protects buyers, and helps platforms comply with consumer protection, AML, and sanctions regulations.

🔹 Frequently Asked Questions (FAQs)

Q1: What’s included in the KYS process?

• Identity verification of individual or corporate sellers
• Business registration and license checks (where applicable)
• Verification of product or service legitimacy
• Sanctions and adverse media screening
• Location and jurisdictional risk assessment
• Website, social media, or listing review for authenticity and prohibited content

Q2: How is KYS different from KYB or KYM?

• KYS is focused on verifying sellers on a platform (often individuals or small businesses)
• KYB assesses larger business entities across a broader compliance context
• KYM is specific to merchants processing payments and handling commercial transactions
  All three serve distinct roles in a platform’s risk-based approach to onboarding.

Q3: Why is KYS important for platforms?

• Prevents fraudulent listings and counterfeit sales
• Reduces risk of transaction laundering and illicit trade
• Builds trust among buyers and users
• Protects the platform from legal and reputational exposure
• Supports compliance with consumer protection laws and marketplace regulations

Q4: What are examples of high-risk sellers?

• Sellers offering prohibited goods (e.g., weapons, drugs, pirated content)
• Use of fake documents or anonymous domains
• Sellers from high-risk jurisdictions or with negative media
• Sudden spikes in volume or pricing inconsistent with listing history
• Sellers using stolen IP or brand impersonation

Q5: How can KYS be implemented or automated?

• Integrate KYC/eKYC tools during seller registration
• Use AI-based content scanning for listings and websites
• Monitor for behavioral anomalies or transaction red flags
• Schedule reverification based on risk tier or activity
• Connect to watchlists, sanctions databases, and IP enforcement feeds