Why direct selling needs KYC
Payouts to thousands of individuals across countries attract fraud: duplicate accounts, stolen identities, money-mule networks. Payment gateways and banks increasingly require you to know who you are paying. KYC is the process; AML screening checks the person against sanctions and politically-exposed lists.
When to verify
Verify before the first payout, not at enrollment. Requiring documents to join kills conversion. Let people enroll, buy and build; gate the withdrawal. DIRSL shows a clear KYC-required banner in the wallet once a balance exists.
What to collect
- Government ID (passport, national ID, driving licence)
- Selfie liveness check
- Address proof where required by the payout method
- Tax identifier (PAN, SSN/EIN, VAT ID) for tax forms
- Bank or wallet details, validated
Duplicate and mule detection
Match on ID number, phone, device fingerprint and bank account. Flag accounts sharing a bank account or address beyond a threshold for review. DIRSL runs these checks nightly and queues suspicious accounts.
Keeping payouts moving
Use automated verification providers for the majority and a manual review queue for the rest. Publish an expected turnaround. Allow partial verification tiers: small payouts with basic KYC, larger ones with full documents.
Record keeping
Retain verification evidence for the period your jurisdiction requires (five to seven years is common), encrypt it at rest, and restrict access to the compliance role. Log every view.