A guide to IBAN numbers
What is an IBAN Number?
An IBAN is an international bank account number, which helps to ensure that international payments are sent and received into the correct bank account.
The reference can be up to 34 characters long depending on your country of origin and consists of letters and numbers, with each section representing a different aspect of your bank account.
In the UK, the first two characters represent the country code, followed by check digits, a bank code, a branch code and, finally, your bank account number.
An IBAN number would look like this: GB33BUKB20201555555555
When do I need to provide an IBAN number?
If making an overseas payment, your recipient should provide you with their IBAN before sending funds. Similarly, you must provide your IBAN if international payments are to be received into your bank account.
IBANs are often used across Europe, so if you’re looking to make a payment into a European bank account, the number will most likely be required.
Are IBANs used outside of Europe?
More locations outside of Europe have started using IBANs such as countries within Africa and the Middle East. A full list of countries which use IBANs can be easily found online.
However, some countries which don’t use IBANs still recognise the number and will process international payments via this method, such as Canada and Australia.
Countries which do not use IBANs often have unique references for international payments. The US, for example, uses routing numbers to ensure that funds are sent to the correct place.
How to locate an IBAN
An IBAN can be found either at the bottom of your bank statement or by logging in to your online banking platform.
The correct IBAN must be used when making an international transfer as the payment could be rejected, with some banks even charging a fee for an incorrect number.
To avoid these setbacks, it’s always best to double-check the IBAN with the recipient or your bank before making any transactions.
Alternatively, if you notice any errors quickly, there could still be time to cancel the payment without incurring a fee or significant delay.
What’s the difference between an IBAN and SWIFT code?
Whilst IBAN and SWIFT codes serve a similar purpose; they are not quite the same thing.
A SWIFT code stands for Society for Worldwide Interbank Financial Telecommunication and can sometimes be called a BIC (bank identification code).
An IBAN is used to locate a specific bank account, whilst a SWIFT code is used to find a particular bank or branch.
SWIFT codes can also be found on bank account statements and via online banking.
The best way to send international payments
Sending payments abroad via a bank can often result in additional costs such as transfer fees, and it is often difficult to secure the best exchange rate.
Using a foreign exchange specialist such as Halo Financial can help you avoid these financial pitfalls through our low-cost service and ability to provide smart FX solutions.
To find out more about how to save money and get the best exchange rates when transferring money abroad, please give Halo Financial a call on 020 7350 5474.
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