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Recognizing the importance of financial inclusion as a policy objective, regulators have endorsed the use of a risk-based approach (RBA) towards know-your-customer (KYC) requirements aimed at strengthening financial integrity. This paper considers applications of the RBA in domestic banking, mobile money and international financial transactions against the features of a rigorous RBA where both the rigor and level of due diligence and the structure and balance of incentives should be proportional to the balance of risks, including that of exclusion. The emphasis is on Customer Identification and Verification (CIV), the most practical element of KYC for small customers. RBA in the financial sector remains a work in progress. A number of countries require lower levels of due diligence for bank and mobile accounts that carry restrictions on balances and transactions and are especially suitable for poor customers, but more clarity is needed on incentives. The challenge is greater for international transactions than for most domestic financial markets because of the greater variety of risks and the need to deal with multiple regulators. The paper offers a number of recommendations, including greater attention to national identification systems as these provide the basis for CIV and to encourage the use of digital technology to shift from cash-cash wire transfers to more transparent account-account transactions between identified holders.