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From international salary credits to overseas fund transfers, cross-border banking relies on standardised account details to ensure accuracy. One such key detail is the IBAN number. It's commonly required when sending money abroad and varies in format depending on the country. This article covers what is IBAN number, why it's used, and what you need to know before making international transfers.
An IBAN, or International Bank Account Number, is a standard system used to identify bank accounts across national borders. It was introduced with the aim of facilitating cross-border electronic bank payments. The IBAN number has maximum strength of 34 characters, and generally consists of the following parts or components:
IBAN is an internationally recognised code that helps avoid routing errors in international money transfers. The payment can be made in a reliable manner as the IBAN can validate the beneficiary account number. All the details needed to identify the account to which payment has to be made are present in the IBAN. For instance, if A is trying to make an overseas transfer to B, he can transfer money using IBAN number which comprises information like his country code, bank code and account number, among other things. This way, A can correctly identify B's unique bank account and send money into the right account.
The IBAN format varies by country but typically includes a country code, two check digits, a bank identifier, and an account number. Here’s how an IBAN example differs across countries:
Both the IBAN and SWIFT code are used in international money transfers, but they serve different purposes and are not interchangeable.
Feature
IBAN
SWIFT Code
Purpose
Identifies individual bank accounts
Identifies the bank or financial institution
Format
Up to 34 alphanumeric characters
8 or 11 alphanumeric characters
Scope
Account-level identification
Bank-level identification
Used in
Mainly in Europe, Middle East and other IBAN-compliant countries
Global (used in 200+ countries)
Example
DE89 3704 0044 0532 0130 00
DEUTDEFFXXX
In short, the IBAN ensures the money reaches the right account, while the SWIFT code ensures it reaches the right bank.
An IBAN must follow the standard format set by the International Organization for Standardization (ISO 13616). It includes a country code, two check digits, and a Basic Bank Account Number (BBAN). The length varies by country but cannot exceed 34 characters. Banks require the correct IBAN to process cross-border payments accurately.
IBAN is used in most European countries and many parts of the Middle East, North Africa, and the Caribbean. It is mandatory for cross-border transfers in IBAN-adopting nations, including the UK, Germany, France, Spain, and the UAE.
Common use cases:
When it comes to transfer of funds, ensure that you are using the correct IBAN to avoid sending money to wrong accounts or any penalties. Here are a few simple steps to find the correct IBAN number for transactions:
Step 1: Log in to your internet or mobile banking and check your account details.
Step 2: Look for the IBAN on your bank statement or welcome letter.
Step 3: You can also contact your bank to verify the IBAN before making a transfer.
If you’re preparing to receive an international transfer, it’s important to know how to find your IBAN number accurately. This unique identifier helps route funds to your bank account without delays or errors. Here's a step-by-step guide:
Step 1: Check Your Bank Statement
The easiest way to locate your IBAN code is by referring to your bank account statement. It’s typically listed near your account number, sort code, and other key details.
Step 2: Log in to Internet or Mobile Banking
Most banks provide access to your IBAN through online platforms:
Step 3: Use Your Bank’s Website or IBAN Generator
Several banks offer online tools that help generate the IBAN based on your existing account number and branch information. Always cross-check the generated details with your bank to avoid transaction errors.
Step 4: Contact Customer Support
If you’re unable to access your IBAN through the above methods, your bank’s customer service team can provide it directly.
Whether you're managing an existing savings account or making an international transfer, knowing your IBAN is essential. In the next section, we explain how to verify your IBAN before using it.
In India, we use IFSC (Indian Financial System Code) for domestic money transfers. An IFSC code is a unique identifier for bank branches across the country. When making online money transfers via RTGS, NEFT or IMPS, you need the IFSC code of the bank where the payees or beneficiaries have their account. You would usually find the IFSC code printed on the cheque book that your bank issues to you at the time of account opening or when requested, or along with other details such as savings account interest rates in your account statement.
For international money transfers, we use a bank identifier code called SWIFT (Society for Worldwide Interbank Financial Telecommunication) code. As stated earlier, SWIFT code helps identify the bank to where the payee has an account.
Most banks now offer the option to open a savings account online, making it easier to get started with everyday banking, including domestic and international transfers. With DBS Bank, the process is simple and entirely digital.
Step 1: Start the process onlineVisit the DBS Bank website or DBS digibank app to begin your instant account opening process.
Step 2: Keep your documents readyEnsure you have your PAN card and Aadhaar card available for a smooth and secure onboarding.
Step 3: Complete Video-KYCUse a smartphone or computer with internet access, camera, and video calling capability to complete the Video-KYC process from the comfort of your home.
Step 4: Verification and activationOnce your KYC details are verified, your DBS Bank Savings Account will be activated promptly.
Step 5: Begin banking instantlyYou can immediately start using your fully digital account through DBS Bank’s Internet Banking platform. Your welcome kit will be dispatched shortly after.
While IBAN may still not be introduced in India, it is safe to say that you can have great use for it if your family is spread across different parts of the globe. So, if you are an NRI residing in the UK, and say your children are studying in Germany or France, you will need the IBAN numbers to make any money transfers to their accounts in those countries. With IBAN, you can remit money in a more convenient and hassle-fee manner.
Download the digibank by DBS app to do online international remittances safely and securely. Open a bank account online today and enjoy quick access to your savings along with easy international transfers.
