IBAN vs BIC: What is the difference?
IBAN stands for International Bank Account Number, a type of identification code used by banks and financial institutions in 80 regions around the world. An IBAN consists of an international component, a country code, check digits and a domestic bank account number. This information helps identify an individual’s bank account, while a Bank Identifier Code (BIC) simply identifies the bank that an account is held with. Both are essential for ensuring funds are transferred to the correct bank account and both are written in a standard, internationally recognised format. They help banks process international payments automatically, in a quick and secure way.
What does an IBAN look like?
Every country using IBANs will issue the same length codes, but the number of total characters in an IBAN varies by country. In the UK, an example of the IBAN format is: GB14HBUK40127512345678
The first two characters (GB) refer to the ISO country code, followed by two check digits (14), four digit bank code (HBUK) six digit sort code (401275) and eight digit account number (12345678).
What does a BIC code look like?
BIC is an acronym for Business Identifier Code, and it is used to identify the bank related to the account. Also known as a SWIFT (the Society for Worldwide Interbank Financial Telecommunication) code, the two terms are used interchangeably.
A BIC code is typically 8 - 11 characters. For example, in the UK, a BIC could appear as follows: AAAABBCCDDD
The first four letters represent the bank’s name (AAAA), the next two characters are the country code (BB), followed by two characters that indicate where the bank’s head office is located (CC) and finally the three digit branch code (DDD).
As a component of the SWIFT network, which has existed for over 40 years, BIC codes provide a secure way for banks to communicate between themselves across the world.
Will I need both an IBAN and a BIC?
BIC codes existed before IBAN numbers were developed and countries that recognise the IBAN system will likely ask for both codes when processing a transaction in a foreign currency.
Every country within the European Union (EU) uses IBAN, so if you are making a Euro transfer you will need both IBAN and BIC
Other countries across Central and South America, Africa and the Middle East have adopted the IBAN system and may request both an IBAN and BIC
Canada do not use IBANs, instead processing international money transfers using their own systems. The United States however do use IBANs to process international payments.
Any reputable service provider, like the ones listed in our Top 10 Money Transfer Companies, will let you know the specific bank details which are needed, to guarantee your global remittance is safely and securely processed.
How do I find a BIC using an IBAN?
An IBAN contains a bank code but this is not branch specific information which means it is not possible to extract a BIC code from an IBAN. This is because a bank code will vary based on each individual account. However, wherever you find your IBAN, you will also find your BIC or SWIFT code stated in the same place.
This information can be found via the following:
Visiting your bank
Calling your bank
Logging into your online bank account
Checking bank statements or personal checks
Summary
There are lots of different banking acronyms that crop up during the money transfer process, albeit a domestic transfer or an international remittance. We strive to answer the most pressing questions our customers have about global payments and banking terminology. While we encourage our customers to utilise the high-quality services offered by money transfer companies such as WorldRemit, Wise, XE, Currencyfair, Currencies Direct, Key Currency, Instarem and TorFX, we understand that banks may still be involved with some online money transfers.
We encourage all our readers to use the MoneyTransfers comparison engine to find out which service provider offers the best deal to suit their unique cross-border needs. For more information on IBANs and BIC codes, why not have a read of our other useful guides, as found below.
