Mexico KYC Requirements and Process Explained [2025 Guide]

Every KYC process looks the same, until you try running one in Mexico.

You think you’ve got your ID checks and document flows sorted… and then someone uploads a handwritten utility bill with a coffee stain and a thumb over the address. Or their INE card from five years ago with half the text faded.

Now multiply that by a hundred users. 

You can’t call it compliance. It’s chaos. A controlled chaos. 

But there’s a pattern to it. And once you get the logic behind how KYC works in Mexico, the whole thing starts making sense.

The laws are globally aligned, but they carry local weight, built around Mexico’s own challenges.

Today, we’ll dig into the system, the process, and more. Plus, you’ll also see how Mexico’s KYC laws compare to that of the US and EU.

Let’s get into it.

KYC in Mexico, Quick Overview

When we talk about KYC in Mexico, we’re really diving into a set of regulatory practices designed to make sure that businesses know exactly who they’re dealing with. 

KYC, or Know Your Customer, is about verifying the identity of your clients and understanding the purpose behind their financial activities. 

Here’s a list of the main players who need to comply:

1. Financial Institutions (banks, investment firms, insurance companies, crypto exchanges)
2. Credit Unions and Savings Institutions
3. Money Remittance Services
4. Notaries and Legal Professionals
5. Real Estate Agencies
6. Dealers in Precious Metals, Gems, and Art
7. Online Platforms (digital wallets, peer-to-peer lenders, e-commerce platforms)
8. Cryptocurrency Platforms (crypto exchanges, digital wallets)

(This list is non-exhaustive.)

Mexico KYC Documents Requirements

The core of KYC compliance lies in the verification of your customer’s identity. Businesses must collect the proper documents to verify their clients’ identities and comply with Mexico’s anti-money laundering (AML) regulations.

You can refer to the list below for a high-level overview.

• Government ID: Official ID (INE card for Mexicans, passport for foreigners)
• Proof of Address: Utility bill or bank statement (recent, typically within 3 months)
• Tax Identification Number (RFC): RFC for Mexican residents; foreign clients may provide proof of income or tax documents
• Source of Funds: Pay stubs, bank statements, or tax returns (for higher-risk clients or large transactions)
• Facial Photo / Video Verification: Selfie or live video (for eKYC or remote verification)

KYC Process in Mexico: Step-by-Step

Now that we’ve covered the essential KYC document requirements in Mexico, it’s time to understand the KYC process itself.

Step 1: Customer Identification (CIP)

The first step in the KYC process is verifying the identity of your customer. Businesses must collect official identification documents from customers to confirm their identity. Mexican nationals need to provide an INE card (National Electoral Institute card), while foreign nationals will typically need to submit a passport.

Step 2: Customer Due Diligence (CDD)

The next step is to assess their risk profile. This is the Customer Due Diligence (CDD) phase, where businesses evaluate whether the customer might engage in suspicious or illegal activity.

Assess the customer’s financial history, profession, and the nature of their financial transactions. Customers with high-risk profiles, such as politically exposed persons (PEPs) or those involved in large-scale transactions, are subject to Enhanced Due Diligence (EDD).

Step 3: Document Verification

Verify the official government ID to ensure it matches the person’s claimed identity. Then, confirm the proof of address, which could be a utility bill or bank statement that’s no more than 3 months old.

For high-risk clients, businesses are required to verify the source of funds (e.g., pay stubs, bank statements, tax returns). In some cases, businesses may also require facial recognition or video verification as part of their eKYC process.

Step 4: Transaction Monitoring

Once the customer is onboarded, ongoing transaction monitoring is essential to ensure that their financial activity remains legitimate. Monitor transactions for unusual activity such as large cash deposits or cross-border transfers that don’t align with the customer’s usual behavior. 

If any transactions raise a red flag (like large, unexplained transactions or Frequent international transfers with no clear business purpose), businesses must report them to the Unidad de Inteligencia Financiera (UIF). 

Step 5: Record-Keeping

Finally, businesses must retain comprehensive records of all KYC documents and transactions, making them accessible for audits and regulatory checks. These records must be stored for at least five years after the business relationship ends, in line with regulatory requirements.

How Mexico’s KYC Differs from the US or EU

Mexico’s KYC regulations are fundamentally aligned with international standards, but they also have specific nuances shaped by the country’s unique challenges, such as high levels of financial crime, including money laundering and drug trafficking.

 

Aspect	Mexico	US	EU
Regulatory Bodies	Comisión Nacional Bancaria y de Valores (CNBV) and Unidad de Inteligencia Financiera (UIF)	Financial Crimes Enforcement Network (FinCEN) and Office of Foreign Assets Control (OFAC)	European Central Bank (ECB), FATF compliance, and national financial regulators
Legal Framework	Ley Anti-lavado de Dinero and Federal Law for the Prevention and Identification of Operations with Illicitly Obtained Resources	Bank Secrecy Act (BSA), USA PATRIOT Act, and FinCEN guidelines	EU’s 4th and 5th Anti-Money Laundering Directives (AMLD)
eKYC and Digital Verification	eKYC is emerging, but many institutions still rely on manual verification processes	eKYC is widely adopted, with FinCEN enforcing strict guidelines on electronic verification	eKYC is common, but regulations differ slightly by country; GDPR applies in all EU states
Threshold for Reporting	Mexico generally has lower thresholds for transaction reporting, especially in high-risk sectors like real estate	The threshold for reporting is relatively higher, especially for cash transactions	EU’s thresholds vary across member states, but they generally align with FATF standards
Crypto Regulation	Fintech Law (2018) regulates crypto exchanges, digital wallets, and virtual assets under AML/KYC compliance	Heavily regulated with FinCEN and SEC overseeing crypto activities and providing detailed guidelines	Cryptocurrency is governed under 5AMLD (EU-wide), which includes KYC compliance for crypto transactions

Tools to Streamline KYC Compliance in Mexico

Thankfully, several KYC tools have emerged to help businesses stay compliant with Mexico’s anti-money laundering (AML) laws and customer due diligence (CDD) requirements.

1. Digital Identity Verification Tools

Digital identity verification tools are essential for businesses to verify the identity of customers quickly and securely. These tools use technologies like OCR (Optical Character Recognition) and biometrics to authenticate identity documents in real-time.

Key Features:

• Instant document verification.
• Facial recognition and biometric matching.
• Integration with official identity databases. 

These tools help businesses meet Mexico’s KYC requirements by ensuring that customer identities are verified accurately and efficiently.

2. AML Risk Assessment Software

AML risk assessment tools allow businesses to evaluate the risk profiles of their customers, helping to identify any potential red flags related to money laundering or terrorist financing.

Key Features:

• Customer risk scoring based on transaction history, profession, and geographical location.
• Alerts for high-risk customers (e.g., PEPs, high-value transactions).
• Real-time monitoring of suspicious activities. 

These tools make it easier for businesses in Mexico to ensure they are not inadvertently engaging with high-risk customers.

3. eKYC Solutions

Electronic Know Your Customer (eKYC) solutions are rapidly becoming essential in Mexico’s fast-evolving fintech space. These tools streamline the KYC process by allowing businesses to collect, verify, and store customer data digitally, without the need for face-to-face meetings.

Key Features:

• Remote document upload and real-time verification.
• Video-based customer identification.
• Secure, encrypted data storage and compliance with local data protection laws. 

eKYC solutions provide convenience and efficiency, making them perfect for businesses dealing with a large volume of remote clients.

4. Watchlist Screening Tools

In Mexico, businesses are required to perform watchlist screening to ensure their clients are not involved in financial crimes or linked to sanctioned entities.

Key Features:

• Real-time screening against global and local watchlists (e.g., OFAC, UN Sanctions, FATF lists).
• Automatic flagging of individuals or entities tied to illicit activities.
• Integration with customer onboarding and transaction monitoring systems. 

These tools provide an additional layer of protection, ensuring businesses are always aware of who they are working with.

5. Automated Transaction Monitoring Systems

Automated transaction monitoring systems track customer transactions in real time, flagging suspicious behavior and providing businesses with a deeper view into their customers’ financial activities.

Key Features:

• 24/7 transaction monitoring to detect unusual patterns.
• Customizable alert thresholds for different transaction types.
• Integration with reporting systems for seamless suspicious activity reports (SARs). 

These tools are vital for businesses in Mexico to meet UIF reporting obligations and AML compliance.

For those looking to simplify this journey, Signzy provides both standalone and full-suite KYC solutions. Take a no-cost demo to discover how Signzy can support your business in meeting Mexico’s KYC compliance requirements.