TYS (Trust Your Supplier) – Additional Analysis by Brandon Tippelmann
Know Your Customer (KYC) is one of the most important measures that is incorporated by business’ as part of their compliance with Anti-Money Laundering (AML) standards and regulations. KYC compliance standards have also become best practices for firms that operate outside the traditionally targeted banking industry, as more companies are collecting and storing data on their customers. Verifying the person connected with an account is of the upmost importance, but what about the vendors that you interact with on a Business-to-Business (B2B) level? What good is your security if the business you are working with are not being held to the same standards?
This is the problem that IBM and Chainyard are coming in to fix. Ensuring the authenticity of the vendors that you are working with, via a blockchain network, will improve the internal controls and security of all firms that participate. From an audit perspective, one of the most common types of fraud include paying illegitimate vendors for services/goods that do not truly exist. Limiting your business dealings to those who are verified on the Trust-Your-Supplier (TYS) platform essentially eliminates this audit risk, as all vendors would be vetted when being added to the blockchain network.
This TYS platform is logically the next step in AML compliance. Integrating a blockchain platform as part of this will promote widespread adoption across all sizes of companies due to the trickle-down effect from some of the major companies taking part in this project. If successful, the TYS platform from IBM and Chainyard could light the spark for the true adoption of blockchain throughout our global economy, making it one of the most important technological advancements of our generation.