Did you even understand what you wrote, OP ?
Banks do not make money from KYC, it is necessary by law to know your customer, got all the information about their identity and possibly more. In my country it has come to much more than simple id checks , they ask proof of any transactions in your bank account, this is too much in my view.
Yes, KYC has nothing to do with banks printing cash. This is most likely a public safety tool, as it is a measure aimed at preventing money laundering and combating the financing of terrorism. In June 2019, the FATF international commission obliged states to introduce recommendations developed by them into their national legislation within a year, including on the identification of senders and recipients of transactions worth over one thousand euros.
One way or another, there are existing legislative acts, which are subject to all structures, including banking. The origin of any feudal asset can be traced only if it is in digital form, because paper money is not controlled by anyone. That is why the government has long been recommending the transition to cashless payments. it is the banking system that helps the government, with full KYC, to control everyone's income and expenses.