KYB Compliance in Botswana, A 2025 Guide for Regulated Businesses

Botswana’s reputation as one of Africa’s most stable and transparent economies makes it an attractive destination for financial services, cross-border trade, and foreign direct investment. As fintech adoption grows and more businesses onboard corporate clients digitally, Know Your Business (KYB) compliance has become a critical requirement for regulated entities operating in the country.

KYB goes beyond basic company registration checks. It focuses on understanding who is behind a business, how it operates, and whether it poses money laundering, fraud, or sanctions risks. In Botswana, effective KYB is an essential part of the broader AML framework and a key expectation for banks, fintechs, and other reporting entities.

This guide explains how KYB works in Botswana in 2025, covering the legal framework, business due diligence requirements, and practical considerations for digital KYB implementation, including how platforms like VOVE ID support structured, compliant corporate onboarding aligned with local regulatory expectations.

Botswana’s KYB and AML Regulatory Framework

KYB obligations in Botswana stem from the country’s anti-money laundering and counter-terrorist financing legislation. The main legal instruments include:

• Financial Intelligence Act (FIA)
• Financial Intelligence Regulations
• Sector-specific directives issued by the Bank of Botswana (BoB) and other supervisory authorities

The Financial Intelligence Agency (FIA) is responsible for AML supervision, receiving suspicious transaction reports, and ensuring that reporting entities apply appropriate customer and business due diligence measures.

Botswana aligns its AML and KYB framework with FATF recommendations and participates in regional cooperation through ESAAMLG. As a result, businesses are expected to apply a risk-based approach when onboarding and monitoring corporate customers.

Who Must Perform KYB in Botswana

KYB requirements apply to all reporting entities that establish business relationships with legal persons or arrangements, including:

• Banks and non-bank financial institutions
• Payment service providers and electronic money issuers
• Forex bureaus and remittance providers
• Insurance companies and investment firms
• Certain designated non-financial businesses and professions

For fintechs, KYB obligations arise when onboarding merchants, corporate users, agents, or business partners, even if the relationship is established remotely.

Core KYB Requirements in Botswana

KYB in Botswana focuses on identifying and verifying both the legal entity and the individuals who ultimately own or control it.

Typical KYB checks include:

1. Business Identification
Regulated entities must collect and verify key company information, such as:

• Registered business name
• Registration number
• Legal form and incorporation date
• Registered address and principal place of business

Company registration data is usually obtained from Botswana’s official business registry.

2. Ownership and Control Structure
Businesses must identify:

• Directors and senior management
• Shareholders and beneficial owners
• Any individual exercising significant control

This step is critical to prevent the misuse of corporate structures for money laundering or terrorism financing.

3. Beneficial Ownership Verification
KYB requires identifying natural persons who ultimately own or control the company, typically those holding a significant ownership stake or decision-making power. Where ownership structures are complex, additional documentation and verification may be required.

4. Understanding the Nature of the Business Relationship
Reporting entities must assess:

• The company’s business activities
• Source of funds and expected transaction volumes
• Geographic exposure and counterparties

This information supports risk classification and ongoing monitoring.

Enhanced Due Diligence for Higher-Risk Businesses

Not all corporate customers carry the same level of risk. Under Botswana’s AML framework, Enhanced Due Diligence (EDD) is required for higher-risk entities, including:

• Companies with complex or opaque ownership structures
• Businesses operating in high-risk sectors
• Entities linked to politically exposed persons
• Cross-border businesses with exposure to high-risk jurisdictions

EDD may involve deeper ownership analysis, additional documentation, and more frequent reviews.

Ongoing Monitoring and Record Keeping

KYB is not a one-time exercise. Regulated businesses in Botswana must:

• Monitor corporate customers for changes in ownership or control
• Review transaction activity against expected behavior
• Keep KYB records for the legally required retention period
• Report suspicious activity to the Financial Intelligence Agency

Failure to maintain up-to-date KYB information can expose businesses to regulatory sanctions and increased financial crime risk.

Digital KYB and Automation in Botswana

As fintech and digital financial services expand, many businesses are moving away from manual KYB processes. While Botswana’s regulations do not prohibit digital KYB, businesses must ensure that automated processes are reliable, auditable, and aligned with regulatory expectations.

Digital KYB solutions can support compliance by enabling:

• Automated company registry checks
• Beneficial ownership mapping
• Screening of directors and shareholders
• Risk-based KYB workflows

When implemented correctly, digital KYB reduces onboarding friction while maintaining strong compliance controls.

Common KYB Challenges for Fintechs and Regulated Businesses

Despite a relatively mature regulatory environment, businesses often face challenges such as:

• Manual verification of company documents
• Difficulty identifying beneficial owners
• Slow onboarding of corporate customers
• Inconsistent KYB processes across teams

For early-stage fintechs, these issues can slow growth and increase operational costs if KYB is not built with scalability in mind.

How Technology Supports KYB Compliance

Modern KYB platforms help regulated businesses in Botswana manage corporate due diligence more efficiently. By combining company verification, ownership analysis, and ongoing monitoring, technology enables consistent application of KYB controls across customer segments.

Solutions like VOVE ID support digital KYB by helping businesses verify legal entities, assess ownership structures, and apply risk-based due diligence in line with AML requirements. This allows teams to stay compliant while maintaining fast and scalable onboarding processes.

Final Thoughts

KYB compliance in Botswana is a fundamental requirement for any regulated business onboarding corporate customers. With increasing regulatory scrutiny and growing digital adoption, businesses must ensure their KYB processes are both robust and adaptable.

By understanding local requirements and leveraging compliant digital KYB solutions, fintechs and regulated entities can reduce risk, meet regulatory expectations, and support sustainable growth in Botswana.