{"id":11399,"date":"2026-05-14T16:21:47","date_gmt":"2026-05-14T16:21:47","guid":{"rendered":"https:\/\/www.amlcc.com\/?p=11028"},"modified":"2026-05-14T16:21:47","modified_gmt":"2026-05-14T16:21:47","slug":"whats-the-difference-between-kyc-and-cdd","status":"publish","type":"post","link":"https:\/\/www.amlcc.com\/ky\/whats-the-difference-between-kyc-and-cdd\/","title":{"rendered":"What’s the difference between KYC and CDD?"},"content":{"rendered":"\n

What’s the difference between KYC and CDD?<\/h1>\n\n\n
\"Lisa<\/div>
Lisa Simms<\/span>

Director and Founder of AMLCC and AMLCC Consult<\/h3><\/div><\/div><\/div><\/div>\n\n\n
\"What's<\/figure><\/div><\/div>\n\n\n\n
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KYC (“know your customer”) and CDD (“customer due diligence”) are both international AML terms used by regulators, financial institutions and other regulated businesses around the world. They overlap heavily, which is why they often get used interchangeably. They aren’t quite the same thing.<\/p>\n\n\n\n

KYC is typically the narrower concept, focused on identifying and verifying the customer. CDD is the wider process set out in FATF Recommendation 10, which includes identification and verification but also extends to beneficial ownership, understanding the relationship and ongoing monitoring. In practice, KYC sits inside CDD.<\/p>\n\n\n\n

Where the terms come from<\/strong><\/h2>\n\n\n\n

Both KYC and CDD have roots in the global AML framework. CDD is the formal language used in the FATF Recommendations, which are the international standards for combating money laundering<\/a>, terrorist financing <\/a>and proliferation financing<\/a>. <\/p>\n\n\n\n

FATF Recommendation 10 sets out what CDD must include, and national regulators around the world have embedded those requirements into their own AML laws.<\/p>\n\n\n\n

KYC predates the modern FATF framework. It originated in banking regulation, particularly in the United States, where “know your customer” rules grew out of the Bank Secrecy Act and were strengthened after the USA PATRIOT Act in 2001. <\/p>\n\n\n\n

The term spread internationally through global banking practice and is now widely used by regulators in many jurisdictions, including in EU guidance, Basel Committee publications and national AML rulebooks.<\/p>\n\n\n\n

The result is that both terms appear in international regulation, often alongside each other. KYC tends to refer specifically to customer identification and verification. CDD covers the wider process.<\/p>\n\n\n\n

What KYC requires<\/strong><\/strong><\/strong><\/strong><\/h2>\n\n\n\n

KYC focuses on establishing who the customer actually is. In most regulatory frameworks, that commonly involves these four elements:<\/p>\n\n\n\n