IBAN - what is it? International bank account number

2024 Author: Howard Calhoun | [email protected]. Last modified: 2023-12-17 10:16

In today's society, international transfers have become very popular. And it is no secret that it is more convenient to carry them out from a bank account. When you need to receive a transfer from the countries of the European Union and the European Economic Area, as well as some other countries, the sender will ask you for an IBAN code. What is it and what is it for?

The abbreviation IBAN stands for International Bank Account Number. This means that it is an ordinary code that operates on the international site. It is assigned according to the accepted international standard.

Purpose and main benefits of IBAN

IBAN (international bank account number) you will need if you decide to make a money transfer to a bank account located in an EU or EEA country, or in some other countries. The code number can be obtained by sending a request to the recipient of funds.

If the code is not indicated in the payment documents or if it is written incorrectly, the recipient will not receive the money. They will return backto the sender, but not in full, but minus the bank commission. The order related to the indication of IBAN in all payment orders, as part of payments in foreign currency in favor of customers of banking institutions of the EU and EEA countries, came into force on January 1, 2007. Now this code is used in more than ninety countries of the world.

Let's list the main advantages of using this identifier:

• accounts in banking institutions are established according to a single standard;
• automatically passes bank account validation;
• improving customer service;
• payments are automatically processed;
• payment is faster and the transaction cost for the bank customer is reduced;
• there is a decrease in the likelihood of an error on the part of the operator when performing the transfer.

Code structure

Let's consider the structure of the IBAN code. What this identifier is, will help determine the decoding of the alphabetic and numeric characters of which it consists. The number of characters reaches 34, and each of them carries certain information:

• the first two characters are the country code of the account holder's banking institution;
• the next two are the control unique code, which is set according to the international standard;
• the next four repeat the first four numerical values of the financial institution's BIC code;
• remaining numbersrepresent a unique account code of the owner, which is set by the banking institution.

Which countries already use the IBAN?

More than ninety countries of the world use the international bank account identifier in the banking system. They also include the former allied states - Georgia and Kazakhstan. In Russia, banking institutions do not yet have an IBAN. What it is, most of our citizens have no idea. But now they are often faced with the need to indicate this identifier in order to receive funds from abroad.

Interestingly, in Kazakhstan, Sberbank IBAN is already using IBAN for money transfers abroad, while the central office of Sberbank of Russia has not yet been affected by this innovation.

How to make currency transfers to Russia?

As it became known, Russian banks do not use the IBAN identifier in their activities when carrying out transactions related to the transfer of funds from the EU and EEA countries. Therefore, our citizens may face some difficulties in their implementation. Since if you do not provide this code to the European sending bank, it will simply refuse to complete the transaction.

What to do in this case? If you yourself are the sender and you need to transfer some amount to Russia, try to explain the current situation to the bank employee. If you are the recipient, then explain to the sender that in order to complete the transfer, he only needs to specify those detailsowned by your Russian bank. If the conversation with the bank did not bring any result, contact another banking institution.

To transfer to an account opened with Sberbank or some other banks, you will need to provide SWIFT and BIC codes (it does not have an IBAN).

What is SWIFT? This code is a kind of analogue of IBAN, but unlike it, this identifier is valid in the Russian Federation.

BIC code is an internal bank number that is set for any account serviced in Russia. It allows you to determine not only the owner of the account, but also the geographical location of the bank branch in which this account was opened.

Both of these identifiers are included in the required details of an account operating in Russia. In general, and for European countries, it is enough to indicate these details in order for the money transfer operation to go through.

How do I know if a given recipient is an IBAN?

If you enter the wrong IBAN code, then the money simply will not reach the addressee and will be returned to the sender minus the bank's commission. The IBAN check can be carried out using the IBAN_checker program developed by American Express Bank Ltd. For verification, you need to enter the code provided by the recipient in the appropriate line. The program determines the correctness of the code by the following parameters:

• correct spelling of the identifier;
• correct number of characters in the number.

If bothof these indicators are correct, it means that the IBAN check was successful, you have the correct data.