KYC stands for KNOW YOUR CUSTOMER. It refers to the obligation for any business to gain & maintain sufficient knowledge of its customers.
KYC is a regulatory obligation for Payment Institutions, as set in the European Directive 2015/849 of the European Parliament and of the Council of 20 May 2015 on the prevention of the use of the financial system for the purposes of money laundering or terrorist financing
While it might seem restrictive at first, it should be at the heart of your business concerns and can become a key Competitive Advantage as it dramatically helps reduce fraud as well as reprehensible behaviors on your platform. It therefore is a guarantee for responsibility & sustainability of your business.
The creation of a payment account requires to provide us (automated through the API) with some specific information (more info here), and the increase in numbers/amounts (change to the KYC2 status) of operations onto a payment account the provision of KYC documents (ID, proof of address, etc.).
For additional insights on KYC, just take a look at the dedicated Lemon Way blog entry, here