In this guide we will be discerning the main similarities and differences between an IBAN and an account number. These are both types of bank codes called upon during money transfers: one is designed to streamline cross-border transactions, while the other is used to facilitate domestic payments.
The information included in this article is designed to help any readers struggling to differentiate between IBANs and account numbers, in order to ensure all future money transfers and simple, easy and fast.
What is an IBAN/Account number?
IBAN stands for International Bank Account Number, a code used around the world to identify individual bank accounts. They are required to identify the correct overseas bank account during a cross-border transaction.
What is the format of an IBAN/Account number?
Made up of alphanumeric characters, an IBAN can be no more than 34 characters long. An example of an IBAN: AA-BB-CCCC-DDDDDD-EEEEEEEE
This code can be broken down into the following information:
[AA] country code: this identifies the country where the bank account is located
[BB] check digits: this enables the sending bank to perform a security check of the routing destination
[CCCC] bank identifier: this code identifies the account holder’s bank
[DDDDDD] sort code
[EEEEEEEE] account number
When will you need an IBAN/Account number?
As the name suggests, an International Bank Account Number is used for sending and receiving interbank transfers from overseas contacts. They may also be called for during other international payment procedures such as setting up a wire transfer.
Who uses an IBAN/Account number?
The IBAN format is used mostly within the EU, but it is also used by financial institutions across the Caribbean, Middle East and Africa. One key global market that does not use IBAN is the United States. However, if you are based in the US and making a transfer to an account in Europe, it’s likely that you’ll need your recipient’s IBAN.
Where can I find an IBAN/Account number?
If you don’t have your IBAN to hand, you will be able to find out the number by doing the following:
Logging into your online banking
Contacting your bank directly via phone
Visiting your local branch in-person
Reading a bank statement
As two very similar sounding financial terms, you would be correct for assuming these banking terms are interlinked. A bank account number can be derived from an IBAN, and being able to decode an IBAN is a helpful trick for anyone making regular global money transfers. We have written a number of guides about IBANs, account numbers, routing numbers, BIC and SWIFT codes, for anyone who needs to grasp the purpose of each. Before arranging a remittance, check out our money transfer search engine tool and explore our related content section below.
Cheaper alternatives to bank transfers
Bank transfers are not the cheapest way to send money internationally. If you want to save money, then switching to a specialist transfer provider is the way to go. Companies like Wise and XE Money Transfer are in a position to offer better deals because they have lower overheads.
The FX rates charged by banks have a markup percentage that is significantly higher than what alternative transfer providers offer. In fact, many companies match the mid-market rate for most currency pairs.
Also, you can enjoy lower fees when using an alternative to banks. For example, TorFX charges no fees irrespective of how much money you are sending. This means you do not need to pay $20 to $50 per transfer.Send money with TorFX