What is enhanced due diligence? The extra checks for higher-risk customers
By SendPay Business · · 2 min read
Enhanced due diligence, or EDD, is the extra level of checking a money platform carries out on customers who pose a higher risk of money laundering or financial crime. It goes further than the standard customer due diligence everyone gets at sign-up.
When it applies
- The customer is a politically exposed person, or closely linked to one.
- The customer or payments involve a high-risk country.
- Transactions are unusually large or complex, or have no clear purpose.
- Something in the customer's profile or activity raises a red flag.
What the extra checks involve
Typical EDD steps include asking where the customer's money and wealth came from and seeing evidence, closer checks on who really owns a business, senior sign-off before accepting the customer, and more frequent monitoring of their payments afterwards.
Why it matters
Anti-money-laundering rules in the UK, EU and many other places expect firms to take a risk-based approach: light checks where risk is low, deeper checks where it is high. Getting EDD wrong can lead to fines and to criminals using the platform.
Where SendPay fits
Every SendPay platform includes customer identity verification at sign-up, powered by licensed partners. Your own anti-money-laundering policies, including when to apply enhanced checks, remain your responsibility, and SendPay tells you in writing what applies before you pay.
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This guide is general information, not legal or financial advice. SendPay Business is a technology company, not a bank, and does not take deposits; regulated services on the platforms are provided by licensed partners. PayPal, Patreon and Substack are named as reference points only and are not affiliated with SendPay Business.