What is the meaning of IBAN code and how many numbers does it consist of? Let’s find out the meaning, functions and composition of IBAN.
The IBAN code (International Bank Account Number) is, notoriously, a code that is used to identify an account and, above all, to make and receive bank transfers.
Introduced to standardize the identification of current accounts, the IBAN has simplified and made cross-border payments safer, reducing errors and processing times. But how is the code composed and, consequently, what does each individual number identify? Are there other functions for this code?
In our guide, we will explore in detail what the IBAN is, what it is used for, how it is composed and how to read it correctly, providing practical examples for a complete understanding.
What is the IBAN? Here’s the meaning
As mentioned, if you need to make or receive a transfer, the bank necessarily requires the IBAN code of the recipient, as well as the sender in the case where the payments are made from one account to another.
The IBAN, acronym for International Bank Account Number, is an alphanumeric code used internationally to uniquely identify a bank account.
Its introduction has allowed standardizing bank details; before the adoption of the IBAN, each nation used its own account identification systems, making international payments complex and subject to errors. With the IBAN, however, you have a standardized format that includes detailed information about the account, such as the country of origin, the bank, the branch and the specific account number.
This code was developed by the European Committee for Banking Standards (ECBS) and subsequently adopted as the international standard ISO 13616 in 1997.
What is the banking IBAN used for
Given its characteristics, the IBAN is not an option but a necessity: starting from January 1, 2018, in fact, national transfers can only be carried out using an IBAN code and no longer just using the ABI, CAB codes and the current account number to which the payment is to be made.
Thanks to the IBAN, financial institutions have all the information needed to route payments to the correct recipient, reducing the risk of errors and delays in both national and international transactions. Furthermore, the use of the IBAN helps to ensure the security of the financial transactions themselves, as it provides a method not subject to interpretation to verify the identity of the beneficiary of the payment.
Furthermore, the IBAN is used for many banking operations, such as direct debit of utilities, salaries and pensions, as well as for the crediting of bank transfers and other payments. The standardization introduced by the IBAN is particularly relevant within the SEPA (Single Euro Payments Area), the single euro payments area, which includes many European countries. Within SEPA, the use of the IBAN is mandatory for all banking transactions, ensuring a uniform and simplified process for cross-border payments.
How many digits does the IBAN consist of in the world
The length of the IBAN varies from country to country, as each nation has the right to determine its own specific structure within the limits established by the international standard.
In Italy, the IBAN is made up of 27 alphanumeric characters. Other countries adopt different lengths; for example, the IBAN in Belgium is 16 characters long, while in Germany has 22. According to the ISO 13616 standard, the IBAN can have a maximum length of 34 characters, although most countries use shorter codes.
This variation in length is due to different national banking needs and structures, but the common goal remains to provide a unique and standardized identification of current accounts at an international level.
How to read an IBAN: some examples to understand
These are the general rules of the components, which, however, in turn are made up of different indications and nomenclatures, which we can understand better with an example.
Italian IBAN
| Country Code | International CIN | National CIN | ABI | CAB | Account Number |
|---|---|---|---|---|---|
| IT | 11 | X | 03268 | 10001 | 100000000000 |
| 2 letters to identify the country | 2 international control numbers | 1 letter for the national control | 5 bank identification numbers | 5 bank branch identification numbers | 12 unique alphanumeric characters for each current account |
In more detail, therefore, we find:
- Country Code (2 digits, for Italy it is IT);
- International CIN (2 control digits);
- BBAN Code (23 characters).
Where the BBAN in turn is composed of:
- National CIN (1 character);
- ABI (5 numbers);
- CAB (5 numbers);
- Account Number (12 numbers).
If the account number is less than 12 digits, you will need to prefix as many zeros as there are digits needed to reach 12.
German IBAN
DE89370400440532013000
- DE: Country code (Germany).
- 89: Check digits.
- 37040044: Bank code of the branch.
- 0532013000: Current account number.
Unlike the Italian IBAN, the German one does not include a separate CIN code, but incorporates the bank code directly into the account number.
British IBAN
GB29NWBK60161331926819
- GB: Country code (UK).
- 29: Check digits.
- NWBK: Bank code (National Westminster Bank).
- 601613: Branch code.
- 31926819: Current account number.
As you can see, each country adapts the IBAN structure to its own banking needs, while still respecting the ISO directives.
Where can I find the IBAN code?
We often find ourselves having to look for the IBAN code to communicate our bank details to someone who needs to make a payment to us. Sometimes, however, we need it in the case of direct debit, direct debit or other similar operations. And where can we find this code quickly? Among the many documents and tools (including digital ones) provided by the bank, the IBAN can be easily found in several ways.
- Account summary: all statements and summary documents of the bank account include the IBAN code.
- Internet Banking: if you have access to Home Banking, you can find your IBAN by accessing your online account and searching for the information and details of the account itself. Both via website or mobile app, of course. In almost all cases, it is possible to copy or send the IBAN code (and other banking information) directly from Home Banking to the recipient in question.
- Debit or credit cards: increasingly often, the IBAN code is printed directly on the front of the card linked to your current account.
- Payment documents and receipts: if you have received bank transfers or made payments via bank transfer, your IBAN will be shown on the payment documents and receipts.
- Direct request to the bank: If you are unable to find your IBAN through the methods mentioned above, you can contact your bank directly and ask them to provide it to you.
Remember that the IBAN is a confidential and fundamental code in banking transactions; therefore, treat it with care and do not share it with strangers without a specific reason.
Original article published on Money.it Italy. Original title: Cos’è il codice IBAN, com’è composto e come leggerlo
