While many aspects of the financial industry are changing and evolving over the past years, there are some basics that keep unchanged, and probably will stay for a long time.
We are talking about important codes such as IBAN, SWIFT, BIC and BBAN. These are the codes that have been used for decades to identify not only users, but also bank institutions.
What is an IBAN number?
IBAN stands for International Bank Account Number, and it was implemented to enable the identification of bank accounts across different countries. Every IBAN starts with two numbers followed by two-digits that identify the country.
Originally implemented in 1997 to solve some barriers to international transfers imposed by differing national standards for bank account identification, the International Organization for Standardization (ISO) and European Committee for Banking Standards (ECBS) have published the first standards for the creation of IBAN numbers.
Since then, the ISO 13616:1997 have suffered numerous revisions, with the most recent being ISO 13616-2:2007, already in use for more than a decade. IBANs have been crucial to reduce the errors in international transfers, with an error ratio under 0.1% of total payments.
Even though many banking institutions have decided to use IBAN as the base model for their own account number system, it’s important to highlight that this is not a standard scenario. Ultimately, IBANs are still used with the main purpose of adding information to facilitate payments between accounts in different countries.
How is the IBANs structure
As expected, since it was created to simplify the information present on international transfers, IBANs structure is simple and pretty straightforward. Below, you can find all the details needed to read and understand it:
- Country code – a code that is specific to a certain country
- Check number – a two-digit number used as a redundancy check to detect errors on identification numbers
- Bank identifier – the unique identifier for the domestic bank
- Account number – the bank account identifier
What is SWIFT?
SWIFT stands for Society for Worldwide Interbank Financial Telecommunications system, and it was developed to facilitate transactions between banks and other financial institutions, allowing for money transfers to be quicker, more accurate and secure.
It was founded in 1973, pre-dating the development of IBANs. Unlike the more recent international bank account number system, SWIFT is a cooperative society owned and operated by its members.
Members pay a one-time joining fee and an annual support fee. These fees vary according to the member class, which is influenced by the share ownership.
Who uses SWIFT?
Even though the original goal was to facilitate transactions, due to its flexible and scalable messaging platform nature, these days it’s used for much more than that. SWIFT provides services to numerous financial institutions:
- Asset management organisations
- Currency exchanges
- Corporate treasuries
- Securities dealers
Currently, according to the official website there are more than 11,000 institutions, spread over 200 countries, connected to the SWIFT network.
What does a SWIFT code look like?
Similarly to how IBANs work, SWIFT codes also follow a set of pre-set rules that allows for easy identification of financial institutions:
- Bank code (4 characters)
- Country code (2 characters)
- Location code (2 characters)
- Branch code (4 characters)
How to find your SWIFT code
Anytime you need to make an international payment you will need to know the SWIFT code of the recipient account, and if you want to receive an international transfer you will need to know your own code.
Usually, the SWIFT code is indicated in the bank statements or can be found in the account information of an online banking account. If that isn’t the case, or you don’t have a statement at hand, there are many online tools that will help you find the desired SWIFT code.
Access the online tool (here) and follow these simple steps:
- Select the desired country
- Select the bank institution
- Select the branch
- SWIFT codes will be displayed on the last selection box
After that you will be able to double-check all the details for the final SWIFT code, which will allow you to guarantee it is referring to the correct bank.
What is a BIC?
BIC stands for Bank Identification Code, or Bank Identifier Code. This code is identical to SWIFT, which is why these terms are often used interchangeably. In many situations, they are even mentioned together (e.g., BIC/SWIFT or SWIFT/BIC).
What exactly is a BBAN code?
BBAN stands for Basic Bank Account Number, and it represents a country-specific bank account number. Every country has a specific BBAN format, and it can vary considerably depending on the standards applied by each nation.
The fact that there is no common EU or other standard to unify BBANs was the main reason for the introduction of IBANs, to help systematise international bank transfers.
What does a BBAN look like?
As previously mentioned, there is no specific standard for the BBAN format, which leads to different countries to implement different formats. Below, you can find a few examples of BBANs in Europe:
- In the UK the Basic Bank Account Numbers have 18 characters, starting with the bank identifier (4 letters) and followed by the branch identifier which is made up of 6 numbers.
- Example – NWBK60161331926819
- In Latvia, these numbers are composed of 17 characters, where the first 4 are letters that identify the bank, followed by 13 numbers that identify the account.
- Example – BANK0000435195001
How to convert BBAN to IBAN?
There are many tools online (like this one) that will help with the conversion of a BBAN to IBAN. As a standard, you will only need to know your account number, which is composed only of numbers, and your banks’ code.
In case you don’t know your banks’ code, with this online tool (here) you will be able not only to find it, but also locate your bank SWIFT/BIC.
After the details are filled in and the tool converts your BBAN to IBAN, you will see a page with extra information about the result. It will confirm that the bank code exists and which type of transfers are supported.
To make sure the IBAN you have is valid, you can use this tool to get extra information. It will show if the length is correct according to the country, which bank it refers to, branch address and supported transfers.
IBAN, BBAN, BIC & SWIFT FAQ – Frequently asked questions
How do I find my IBAN number?
Usually, your IBAN number can be found on your bank statement, positioned in the top-right corner. If that’s not the case, you can find it in your bank’s internet banking platform, or you can generate it using an online calculator.
What is an IBAN number?
IBAN stands for International Bank Account Number and is made up of a maximum of 34 characters. It’s used to help banks process transfers worldwide, and each set of characters represent a specific detail of your bank account.
Which countries use IBAN?
Currently, there are two distinct groups of countries when it comes to the use of IBANs. One where the use is mandatory, and a second one where it is only recommended.
Countries where the use is mandatory
Isle of Man
United Arab Emirates
Countries where the use is only recommended
São Tomé and Príncipe
Isle of Man
United Arab Emirates
Do all banks have IBAN numbers?
No, that is not mandatory in all countries. As an example, countries like the US and India choose to adopt variations of IBANs, such as SWIFT Code, Routing Number, and IFSC Code to process transfers from abroad.
How do I get an IBAN number?
IBANs are attributed by your bank account and should be indicated in your statement. If by any chance that is not the case, you can calculate your IBAN using your bank account details.
What is the difference between IBAN and BBAN?
A BBAN is an identifier that uniquely distinguishes an individual account, at a specific financial institution, in a particular country. On the other hand, IBAN is an international standard for identifying bank accounts across national borders. (via: Harvard University)
What does BIC mean?
BIC stands for Business Identifier Code, and it's the current standard for routing business transactions and identifying business parties.
What is my BIC code?
As a standard, you should be able to find it in your bank account statement. If you access your online banking platform, you can easily access a digital statement and check your BIC code.
Is BIC code the same as SWIFT code?
Essentially, yes. Both BIC and SWIFT serve the same purpose and are identical. SWIFT stands for Society for Worldwide Interbank Financial Telecommunication, while BIC stands for Bank Identifier Code.
What is a SWIFT payment?
SWIFT payments are a type of international transfers that take advantage of the SWIFT international payment network.
Which banks use SWIFT?
SWIFT codes are used in every country worldwide, and are not used exclusively by banks. You can visit this website to find SWIFT codes for specific countries.
What is a SWIFT confirmation?
A SWIFT confirmation is a message acknowledgement, or a confirmation receipt that a specific message has been delivered to the network. But, it’s important to refer that this is by no means a guarantee that the message has been delivered to the bank.