What is IBAN Number? How to Find & Use IBAN

In today’s interconnected world, sending money across borders demands precision. Even a small error can result in delays or failed transactions. That’s where IBAN, or International Bank Account Number, comes in.

But what exactly is IBAN, and why is it so important? In this article, we’ll break it down so you know how IBAN ensures your money reaches the right account, safely and on time.

What is IBAN Number?

IBAN or International Bank Account Number, as the name suggests, is a bank account number identified by banks and financial institutions around the world during cross-border/domestic payments.

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It was initially adopted by the ECBS (European Committee for Banking Standards) and, since 1997, has been established as an international standard under ISO 13616-1:2007.

When a SWIFT code identifies the recipient bank, IBAN identifies the recipient account inside that bank. Certain countries mandate the use of IBAN, so you will need it when you make international payments to those countries.

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What Is the Standard IBAN Structure?

IBAN consists of alphanumeric characters and its length varies depending on the country. It can be anywhere from 15 to 34 characters long.

When it comes to UAE IBAN numbers, they start with AE and consist of 23 alphanumeric characters. The infographic given below represents a standard IBAN format:

Here’s what the UAE IBAN Number – AE47 0331 2345 6789 0123 456 represents:

• AE – ISO Country code (UAE)
• 47 – Check digits for validating the IBAN
• 0331 2345 6789 0123 456 – BBAN (Basic Bank Account Number)

BBAN will have a fixed length per country. In the UAE, the first 3 digits in the BBAN represent the bank code to identify the bank and the next 16 characters represent the customer account number.

How to Find & Use IBAN

If you want to find your IBAN number, just log in to your online banking dashboard or check your bank statement. While doing international transfers, simply provide your IBAN along with the SWIFT code. This ensures your money is sent quickly, securely, and without errors.

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Why is an IBAN Number Important?

You know that a SWIFT code will help to ensure that your money reaches the right bank, right? Then what is the importance of IBAN? Let’s see.

Here’s why IBAN is important.

• Reduce errors – With IBAN, cash transfers will be error-free.
• Saving time – With minimal dependency on manual interpretation and validation of account details, international payments will be quicker.
• Secure – Before every transaction, each character will be validated to avoid errors, thus ensuring security.

What Happens If You Enter a Wrong IBAN Number?

Just imagine that you have sent a parcel and mentioned the wrong house number. What will happen? It will get delivered to the wrong destination, right? Similarly, if you’ve entered an incorrect IBAN, there are chances that it gets delivered to the wrong account.

But, in most cases, the system catches the error and your payment will bounce back. But if the IBAN is valid and actually belongs to another account, there are greater chances for the money to get deposited in that account. In such rare cases, it will be extremely difficult to recover the funds.

Hence, just as you double-check your SWIFT code, you should also verify your IBAN before confirming a transfer.

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Frequently Asked Questions

Who can issue an IBAN?

The account-servicing financial institution has the right to issue an IBAN.

Is IBAN required for domestic transfers?

Yes, in certain countries like UAE, IBAN is required for international and domestic transfers.

Is IBAN a new account number?

No, IBAN is not a new account number. It is just an electronically-recognisable ISO standard format of your existing account number.

Is IBAN the same as SWIFT?

No, IBAN is required to identify the exact bank account while SWIFT is required to identify the bank. You will need both IBAN and SWIFT for cross-border payments.

Does every country use IBAN?

No, not all countries use IBAN. It is standard in Europe, the Middle East, and several other regions. Countries like the United States and Canada, however, use different systems.