Marketplaces have existed for a very long time, whether they involve the sale of household goods or mobile applications. People have become accustomed to the new way of buying and selling.
Verification of Buyers and Sellers
Buyer verification (KYC) has been a standard practice for a long time, and individuals are quite familiar with the need to verify their identity before making purchases. However, a relatively new development that is significantly changing as regulations adapt to new trends in buying and selling is the verification of sellers.
Historically, sellers could open any account without questions and start listing their items. However, a recent issue has emerged where the seller may not actually be a legitimate seller but rather a fraudster attempting to sell non-existent items.
Why is Marketplace Verification Something New?
It’s not necessarily a new concept; some marketplaces have been verifying both buyers and sellers for ages. The issue has been that regulations have not been very clear, and there haven’t been sufficient methods to verify the companies looking to sign up.
What Can We Expect from Regulations Regarding Marketplace Validation?
In any digitized sector, both individuals and businesses need to prove their identities. From a regulatory standpoint, we see this becoming more frequent across various industries. Many marketplaces may face challenges initially, especially those operating on a global basis, as it is difficult to implement practices that thoroughly check and validate information from both individuals (KYC) and companies (KYB).
Which Marketplaces Will Be Affected?
There are already “rumors” about discussions regarding tightening regulations in US marketplaces. While this is speculative, we observe similar changes already happening in Europe, making it logical for the US to follow suit.
What Can Be Done Before Changes Begin to Happen?
Having a robust way of authenticating and verifying both individuals and businesses should always be a priority. We recommend using an orchestration platform like Cellbunq to meet all the mentioned objectives through a single type of integration, covering various compliance needs such as:
Know Your Customer
Know Your Business
Changes are inevitable, and being prepared is crucial. Our advice is always to anticipate changes and take proactive measures to avoid being caught off guard.
Cellbunq can help you meet regulatory requirements and elevate your compliance procedures. Reach out today and speak to one of our dedicated sales experts who can provide more information on how we operate and assist you in achieving the best KYC/AML practices.