Digital Identity Verification in the Netherlands

As a European Union member, the Netherlands has strict regulations around personal data, identity verification and digital services.

Organizations operating in the country can still streamline customer onboarding, ensure compliance and achieve strong match rate performance by leveraging local expertise and state-of-the-art technology.

AML and KYC in the Netherlands

The Dutch Anti-Money Laundering (AML) and Anti-Terrorist Financing Act lays out the requirements for Know Your Customer (KYC) and AML compliance. The act requires financial institutions implement customer due diligence, including identity verification, to prevent money laundering and terrorist financing.

The Dutch Financial Supervision Act established financial industry regulations in the Netherlands. The act requires that financial institutions verify the identity of clients.

The Netherlands also offers guidance for payment initiation service providers (PISPs). 

“A risk-based approach can be taken to verification,” according to the guidance. “We consider it necessary for a PISP to make use of at least two independent and reliable sources.”

Identity Verification Challenges in the Netherlands

Identity verification in the Netherlands is a complex task. The country does not have a credit-scoring system, and the national ID can’t be used for matching purposes. 

Instead, the Netherlands uses a collection of databases with millions of records. That poses challenges during verification and makes it hard to flag duplicates.

Even searching by name can be difficult because people often use their first initial and last name when completing onboarding. That can compound the problem of duplicate records.

Many crown corporation databases in the Netherlands are connected. That means organizations have to create specific matching rules to get information from different databases while making sure the person is the same across all of them.

Business Verification in the Netherlands

Businesses in the Netherlands can register as a:

• Sole proprietor
• Private limited company
• Public limited company
• General partnership
•  Limited partnership

All businesses must register with the Netherlands Chamber of Commerce to be listed in the Dutch Business Register, and foreign businesses must obtain a citizen service number by registering with the Non-resident Records Database.

Guidelines in the Netherlands call for a risk-based approach to verifying businesses. Depending on the risk level, organizations might also have to identify and verify a business’s ultimate beneficial owners to gain deeper insight into the company structure. 

Streamlined Verification in the Netherlands

Organizations face a complex regulatory and verification landscape for people and businesses in the Netherlands. Trulioo can help organizations streamline the process because it connects to multiple data sources in the Netherlands and can return a “Name & DOB” or “Name & Address” match across many sources. 

When organizations blend that data source coverage with services such as watchlist screening and adverse media checks, they create a holistic onboarding strategy that can lead to industry-leading verification rates in the Netherlands.

The challenges multiply when organizations verify businesses in the country. But when they access a vast data source network, local expertise and cutting-edge technology, they can accelerate due diligence – from verifying sole proprietorships to unraveling complex ultimate beneficial ownership structures – on any company operating in the region.

A full suite of in-house verification capabilities, paired with data science and local expertise, can give organizations the insight and flexibility they need to overcome any onboarding challenge in the Netherlands.