How Enigma KYB Cuts Compliance Costs by Up to 80% Without Slowing Down Onboarding
Enigma KYB instantly verifies 70%+ of businesses in under 3 seconds via SoS filings, high-risk classification, and OFAC screening.
Business onboarding is one of the most friction-laden processes in financial services. Too much caution and you slow down growth. Too little and you take on real compliance risk. Enigma KYB is built to solve that tension — automating the verification work that most institutions still do manually, so you can onboard more customers faster without cutting corners on compliance.
The problem with most KYB providers
Most KYB providers can only instantly approve 30–50% of the businesses that apply. Everyone else gets routed to a manual review queue — which means documentation requests, back-and-forth with applicants, and high operational overhead. Those delays cost real money, and some portion of those applicants simply don’t wait around.
The industry has a naming problem too. Many providers call this “auto-approval” — but auto doesn’t mean instant. Auto-approvals are simply approvals that are automated from the customer’s perspective, regardless of how long the process actually takes. Many of those approvals have manual processes running behind the scenes, often taking more than 24 hours to complete.
Instant approvals are different. They are both fully automated and completed in under 3 seconds.
Enigma KYB instantly approves more than 70% of registered businesses in under 3 seconds — roughly 1.5x more businesses than any other data provider.
How Enigma achieves higher instant approval rates
The higher approval rate isn’t magic — it comes from richer data. Enigma enriches Secretary of State registration filings with additional layers of business identity information:
- Foreign filings — registrations across multiple states
- Operating names — DBA names used in practice, not just legal names
- Operating addresses — where a business actually operates, not just where it’s registered
- Websites — the business’s web presence as a matching signal
This enrichment means Enigma can match a business input like a DBA name or website URL back to its underlying SoS filing — even when the application doesn’t perfectly match the registration. That matching capability is what converts businesses that other providers can’t approve into instant approvals for Enigma customers.
The cost impact is significant. Because manual verification is expensive to run, increasing the share of businesses that receive instant approvals generates as much as 80% savings in KYB costs.
What Enigma KYB covers
SoS filing verification
Enigma collects and instantly verifies business and owner identity from Secretary of State filings across the country. Registration statuses are updated bi-weekly, so you’ll know if a business is no longer in good standing before you onboard them — not after. You don’t have to build or maintain the infrastructure to collect this data yourself.
High-risk activity classification
Some businesses operate in categories that require additional scrutiny before approval. Enigma automatically classifies businesses that conduct high-risk activities, covering:
- Cannabis
- Tobacco and Vaping
- Firearms, Weapons and Ammunition
- Adult Entertainment and Dating
- Gambling and Sports Betting
- Payments and Money Transfer
- Multi-level Marketing
- Pawn Shops
- Gift Cards
When a business falls into one of these categories, it’s surfaced as a high-risk classification so your team can make an informed decision — rather than discovering the issue during an audit.
OFAC screening
Enigma screens businesses and their owners against OFAC watchlists on a weekly refresh cycle. The lists covered include:
| Watchlist | Abbreviation |
|---|---|
| Capta List | CAP |
| Foreign Sanctions Evaders | FSE |
| Non-SDN Menu-Based Sanctions | NS-MBS |
| Non-SDN Iranian Sanctions | NS-ISA |
| Non-SDN Chinese Military-Industrial Complex Companies List | NS-CMIC |
| Non-SDN Palestinian Legislative Council List | PLC |
| Specially Designated Nationals | SDN |
| Sectoral Sanctions Identifications List | SSI |
Enigma’s screening engine is used by top 5 U.S. banks, has been audited by regulators, and is proven to have low false positives without an increase in false negatives. That last point matters: reducing false positives without pushing false negatives up is genuinely hard to do, and getting it wrong in either direction creates problems — either unnecessary friction for legitimate businesses or sanctions exposure for your institution.
Staying compliant as regulations change
Enigma uses trusted government data sources — primarily Secretary of State filings — so that the verification you’re doing against Enigma’s data holds up under regulatory scrutiny. That means:
- Business and owner identities verified against official SoS filings
- Easy stakeholder screening against global sanctions and watchlists
- Lower false negative rates that reduce friction during audits
If you’re building or optimizing a KYB program, it’s worth understanding the full landscape of process options available. Our guide A Guide to Optimizing Your KYB Process walks through the trade-offs between building in-house, working with a single provider like Enigma, and waterfalling multiple data sources. And if you want to make sure your data collection covers everything regulators require, the KYB Requirements Checklist is a good starting point.
Ready to see what instant approval rates look like for your portfolio? Learn more about Enigma KYB or get in touch with the team.