IBAN (International Bank Account Number)

The IBAN is an international standard for numbering bank accounts which was adopted to simplify cross-border transfers in Europe and certain other countries.IBAN is used for making international payments because it minimizes the risk of errors when entering account details.

The structure of the IBAN varies by country, but it follows a common format which includes the following elements:

1. Country Code: Two letters which are the international country code (e.g., DE for Germany, FR for France, GB for the United Kingdom).
2. Check Digits: Two digits used to validate the integrity of the number.
3. Basic Bank Account Number (BBAN): The unique number of the customer’s account within the bank, which may include the bank identifier, account number, and in some cases, branch code.

For example, a German IBAN may look like this: DE89 3704 0044 0532 0130 00, where:

• `DE` is the country code for Germany,
• `89` is the check digits,
• `3704 0044` is the bank code (BLZ – Bankleitzahl),
• `0532 0130 00` is the customer’s account number.

The IBAN provides an additional layer of verification to process international payments and reduces the risk of errors when entering bank details.

The IBAN is primarily used for international payments within Europe, the account number is used for domestic payments in most countries.