I am familiar with KYC from a banker's perspective (at least that of a close relative who was a bank manager).
KYC helped them by deny-listing abusive clients between branches, or by allowing the bank to develop heuristics for things like allowing customers to bypass cheque clearing times.
From an end-user perspective, I've had no hangups personally but I do share your grievances about yet-another-shoddy institution holding a photocopy of my ID. My bank truncates passwords when setting them, and when logging in, without telling the user. It boggles the mind.
Thanks for replying I appreciate the insight, although as someone else mentioned the most obvious use (to me) for KYC is censorship / de-banking and I think that was it's intended purpose all along because there's nothing about KYC that specifically enables the two things you mentioned that couldn't be done by a bank on it's own.
The bank can choose to require such identification of their customers for their own business purposes independent of any regulation requiring them to do so.
KYC helped them by deny-listing abusive clients between branches, or by allowing the bank to develop heuristics for things like allowing customers to bypass cheque clearing times.
From an end-user perspective, I've had no hangups personally but I do share your grievances about yet-another-shoddy institution holding a photocopy of my ID. My bank truncates passwords when setting them, and when logging in, without telling the user. It boggles the mind.