WHY IS CUSTOMER DUE DILIGENCE NECESSARY MNS CREDIT MANAGEMENT GROUP PVT. LTD www.mnscredit.com Customer Due Diligence (CDD) is a crucial process for financial institutions to gather and assess data about customers to mitigate risks and comply with anti-money laundering regulations. This section introduces CDD, its definition, and its necessity in maintaining secure business transactions. INTRODUCTION www.mnscredit.com The Importance of CDD This section explains the critical role of CDD in protecting businesses from fraud and the severe penalties associated with non-compliance to anti-money laundering (AML) laws. It will illustrate how CDD serves as a frontline defense for businesses against financial crime. www.mnscredit.com CDD in the KYC Framework Distinguish between CDD and KYC (Know Your Customer) processes, emphasizing how CDD fits into broader regulatory requirements. The explanation will cover different levels of due diligence required based on the customer risk profile.. Types of Customer Due Diligence Detail the various types of CDD including Simplified Due Diligence (SDD) for low-risk scenarios and Enhanced Due Diligence (EDD) for higher-risk situations. This will include examples of circumstances that necessitate each type and the specific processes involved. www.mnscredit.com Process of Customer Due Diligence Outline the step-by-step process of conducting CDD, from the initial verification of customer information to choosing the appropriate level of due diligence and the ongoing monitoring of customer activities. Challenges and Solutions in CDD Discuss the common challenges faced by businesses in implementing effective CDD measures and provide solutions, including the use of advanced technologies like automated verification systems and biometric checks. www.mnscredit.com Conclusion Summarize the necessity of CDD in the current financial landscape and encourage businesses to adopt thorough due diligence processes to enhance their compliance strategies and safeguard their operations. 9 0 6 , D L F T O W E R - A , J A S O L A D I S T R I C T C E N T R E , J A S O L A , N E W D E L H I - 1 1 0 0 2 5 , I N D I A T E L : + 9 1 - 1 1 - 2 6 9 5 4 9 5 5 / 6 6 E M A I L : I N F O @ M N S C R E D I T . C O M Contact us www.mnscredit.com