What Is an International Bank Account Number (IBAN)?

IBAN Explained in Less Than 4 Minutes

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An international bank account number (IBAN) identifies a specific bank account in a format that facilitates international money transfers. IBANs have up to 34 alphanumeric characters and follow an internationally accepted standard that makes them useful in numerous countries around the world.

If you send money to a bank in another country, there’s a good chance that you’ll need to provide an IBAN. In addition, you may need to include other details to supplement the IBAN and ensure that your funds arrive at the intended destination quickly. With the information below, you’ll have a better understanding of what banks want when you move money overseas.

Definition and Examples of IBAN

An IBAN is a unique identifier that banks around the world can use to reference a specific bank account. The IBAN system includes information about the bank account, the bank that holds the account, and the country where the account is located. Banks use the information to quickly send money to (or receive funds from) an account in a different country.

BANs are defined by the International Organization for Standardization (ISO) under ISO 13616.

If you want to send money to a bank account in another country, you often need to provide an IBAN, which you can request from the receiving party. In some cases, banks don’t use IBANs, but those banks can provide alternative instructions on how to wire funds into your account. For example, U.S. banks may not use the IBAN standard, so you typically don’t need an IBAN when moving funds into a U.S.-based bank.

An IBAN may look like the following set of characters: DE17ABCD12345698765. The alphanumeric sequence and grouping have a specific meaning. 

How Does an IBAN Work?

Banks in numerous countries around the world follow the same set of rules to create and use IBANs, which makes it possible to transfer funds relatively easily. Each IBAN may contain up to 34 characters, and the components have a specific purpose. In most cases, the characters follow the sequence below.

Country Code

The first two digits are the country code, which specifies the bank account’s location. For example, the country code for Germany is “DE.”

Check Digits

The next two digits are check digits, which enable banks to verify that the IBAN is valid before processing a transfer. Using a mathematical calculation, banks can determine if there are any data entry errors before sending money. Reversing overseas payments can be cumbersome, so it’s best to prevent problems in the first place.

Bank Identifier

The bank identifier specifies which bank holds the account. This code—or an additional code, depending on the country—may also identify a specific bank branch for the account.

Basic Bank Account Number (BBAN) 

The BBAN defines the individual account that the transfer applies to. That number is equivalent to what you may know as your “account number.” Again, since an IBAN refers to a specific account—such as your individual or joint account—this information is necessary.

Each country has leeway to define an IBAN’s length. For example, an IBAN for Norway uses 15 characters while Iceland uses 26 characters.

Alternatives to IBANs

You may need additional reference numbers for some international money transfers. For example, you might use a Bank Identifier Codes (BIC) or Society for Worldwide Interbank Financial Telecommunications (SWIFT) code to facilitate payments. BIC and SWIFT are sometimes used interchangeably, and BIC may also refer to a “bank identifier code.”

SWIFT codes specify banks and financial institutions around the world; they’re like a routing number. However, unlike IBANs, SWIFT codes do not refer to a specific account at a given bank—you need to provide additional details beyond a SWIFT code to credit funds to a particular account. And in some cases, it’s best to provide both an IBAN and a SWIFT code to ensure that your transfer moves smoothly.

Banks might also ask for routing numbers, also known as “ABA” numbers when you make an international transfer. But that’s likely the case only when you’re moving funds into a U.S. bank. Banks in other countries tend to use SWIFT codes and IBANs, instead. The U.S. does not currently use the IBAN standard, so banks in the U.S. may not allow the use of IBANs.

Key Takeaways

  • IBANs are required for some international transfers between banks.
  • An IBAN identifies a specific account at a financial institution.
  • IBANs use a format that is standardized and accepted in numerous countries.
  • You may need to provide additional bank and account details to complete an overseas money transfer.