The International Organization for Standardization (ISO) has published the international standard for IBAN - International Bank Account Number.
Many years ago money transfers overseas took days to arrive and sometimes never arrived at the destination.
The International Bank Account Number (IBAN) is the structure of the international bank account number, which allows the safe and fast transfer of money around the world. ISO has published the standard ISO 13616, Financial services, International bank account number.
ISO standard 13616-1, Financial services - International bank account number (IBAN) - Part 1: IBAN content, specifies the structure and elements of an international bank account number (IBAN), which improves the quality, efficiency and settlement time of national and international transfers, ensuring a higher degree of security.
Part 1 of the standard is complemented by its part 2, ISO 13616-2, Financial services – International bank account number (IBAN) - Part 2: Role and responsibilities of registration authorities, which details procedures for registration of IBAN formats and elements of data, which are placed in the register.
The standard was first drafted in 1997 and provides a method for creating a unique code that fits into existing banking systems and avoids the risk of confusion when it comes to transferring money between banks in different countries.
The ISO 13616 standard provides a method, which provides a means of structuring information and is intended to facilitate the automatic processing of transfers.
The use of IBAN aims to increase the accuracy of a transaction's data and reduce manual interventions in their processing.
The risk of delay or non-payment due to inaccuracies is reduced, as the bank account of the beneficiary of the funds is credited only through the use of the IBAN.
The ISO technical committee that drafted the ISO 13616 series of standards asserted that a single, universal method for account identification and wire transfers for customers of financial institutions would be practical but too expensive to implement.
The two-part ISO 13616 standard takes into account the fact that financial institutions wish to maintain their current methods of identifying bank transactions.
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