An IBAN (International Bank Account Number) consists of a range of alphanumeric characters that distinctly identify the account held by a customer within a banking institution. It is used to facilitate worldwide payments.
The code is comprised of between 14 and 34 characters, according to the country, and is formed in the following way:
CC (2 letters) CK (2 numbers) BBAN (30 numbers maximum)
CC = Country Code, CK = Control Key; BBAN = Basic Bank Account Number
Example of an IBAN:
Structure of the IBAN:
Country code IBAN key Bank code Sort code Account number RIB (banking identity) key
What is the purpose of an IBAN?
IBAN facilitates transactions and helps to reduce cross-border trade complications by offering a standardised format for the indication and validation of international bank account numbers.
This international standard enables both the account and banking institution to be easily identified and facilitates transfers via automated handling of cross-border payments.
One further advantage of IBAN is that the way in which it was set up guarantees avoidance of errors (a difference of a single digit in a valid IBAN will immediately render it invalid).
How does the IBAN work?
As shown in the example above, the International Bank Account Number comprises:
- The ISO country code which corresponds to two letters at the beginning of the IBAN (76 corresponds to the third and fourth characters of an IBAN, but only if the rest of the IBAN does not contain any letters). FR is used for France.
- Two check digits for validation purposes.
- The domestic bank code.
- The account number.
This structure is set out in ISO standard 13616 and helps to secure the handling and proper processing of cross-border payments. Finally, the check digits provide assurance that the code has been entered correctly and that it has not been corrupted.
The validation of an IBAN is carried out as follows:
- Remove any unsuitable characters (such as spaces or hyphens)
- Take the first 4 characters and place them at the end of the account number
- Replace the letters with numbers using a conversion table (A=10, B=11, C=12, etc.)
- Divide the number obtained by 97
- If the remaining number is not 1, the IBAN is incorrect: modulo 97 is 1.