investor verification

During your search, you most likely come across the term “accredited investor.” Only accredited investors have access to certain investment choices. Someone may be unsure what an accredited investor is or what the benefits of becoming one are. Let’s go over the requirements for becoming an accredited investor and who qualifies.

Affiliated Investor

A person or a firm that is accredited can buy commodities that aren’t regulated by the government (SEC). They have access to a wider range of investment possibilities that aren’t available to everyone, such as property investing crowdsourcing, and venture capital. The SEC determines who qualifies as an accredited investor. These restrictions are designed to limit accredited investors to those with the “financial sophistication” and personal fortune to withstand the risk of uncontrolled investments. Because they lack the same declarations and controls as recognized assets, unauthorized investments are riskier.

What exactly is KYI?

KYI stands for “Know Your Investor,” and it is related to and falls under the same umbrella as KYC (Know Your Customer), which is critical for risk management in the digital age by authenticating investors and investment businesses. It’s a service that verifies investments. KYI and compliance standards have long been standard in the crowdfunding, e-commerce, insurance, and other financial sectors. However, as blockchain technology gets more generally adopted and AML/KYC regulations become more stringent, a growing number of organizations are looking for platforms that can handle the entire KYI process.

Identifying exactly what is required for a full KYI platform can be intimidating for those who are new to the fintech field. Make a list of three key functions that any KYI system must do to get started.

Reduce the likelihood of disaster.

The primary goal of KYI rules and procedures is to reduce the risk for businesses when dealing with their investors. Without suitable standards in place, the company may be subject to dangers such as identity theft, money laundering, and other illicit activities, all of which can harm the brand’s reputation and bottom line. A well-designed KYI program will help the compliance team manage these risks more effectively while also safeguarding the company’s operations.

Furthermore, in today’s rapidly evolving digital marketplace, investors are understandably concerned about the security of their personal information. Private material (such as identification documents and confidential papers for legal companies) must be protected throughout the compliance process; as a result, organizations owe it to their investors, clients, and stakeholders to collect compliance data quickly and accurately.

At every level of the process, KYI provides solutions to protect the privacy of both your firm and your investors. An AI-driven platform that provides full identity verification (learn more about this topic at Fortifid), Enhanced Due Diligence, anti-money laundering (AML) threat monitoring, and other smart safety processes can benefit your firm.

Furthermore, the digital architecture provides cutting-edge technology and data handling to protect investors’ data, lowering risk and increasing confidence in back-office compliance activities.

Maintain your composure.

Lowering the risk is only part of the problem when it comes to commercial crime and data protection compliance. A corporation must ensure that it complies with all legal jurisdictional standards, regardless of where it does business, in addition to securing its operations and investors. It’s easy to lose sight of this in today’s fast-paced business world. The penalties for noncompliance, on the other hand, can be severe enough to have a substantial impact on the bottom line, therefore it’s vital to ensure that the procedure protects against fines, sanctions, lost revenue, and other potential consequences.

Workflows should be made more efficient.

Compliance, regardless of the firm’s size or scope, maybe a very expensive procedure. Traditional AML/KYC arbitration processes, in addition to the rising financial costs of maintaining a compliance workflow, represent a considerable manpower cost, with some companies spending up to 60% of their annual budget on merely staffing a compliance department. In terms of making compliance more accessible and inexpensive, companies need solutions that allow their teams to simplify and automate back-office procedures so they can focus on what matters most—their people.

Why Should Accredited Investors Be Verified?

To summarise, becoming an authorised investor expands your investment alternatives. As a result of the increased opportunities, better results may be attainable. These investments, on the other hand, are risky and can result in significant revenue loss.

What Are the Advantages of Becoming an Accredited Investor?

More possibilities

Accredited investors enjoy a wider range of investment possibilities. The most significant benefit is having access to a broader range of financial possibilities. Accredited investors have access to venture funding, preferred stock, and other investment opportunities that ordinary investors do not have.

Some examples of authorized investor capital markets are as follows:

  • Commercial real estate is available for purchase.
  • Crowdfunding for farms is a growing trend.
  • Hedge funds are a sort of mutual fund that invests in speculative securities.
  • Real estate crowdfunding
  • Real estate syndicates
  • A sort of venture capital is angel investment (also known as venture capital).

More Diversification Options

Accredited investors can further diversify their portfolios by linking directly to other investments. Some people, for example, may prefer to invest in property crowdfunding over the stock or cryptocurrency markets. Although hazardous, these investments can assist to mitigate the unpredictability of other assets.

Possibility to Make More Money

Some of the riskier assets available to authorized investors may pay off handsomely. The key term here is “riskier.” With increased potential for profit comes a larger danger of loss.


Quick KYC for investor verification can save organizations a lot of money by protecting them from doing business with fraudsters and scam artists, as well as inexperienced investors who don’t match the criteria for approved investors.


Please enter your comment!
Please enter your name here