Two check digits in every IBAN catch almost any typo before money moves
Swap two digits in an old-style bank transfer and the payment might wander between banks for days, racking up fees. The IBAN fixes that with two check digits near the front, which reliably flag a dropped, doubled, mistyped or transposed character the moment the number is entered.
Before the standard, every country identified banks, branches and accounts its own way, and payments often lacked vital routing details. SWIFT codes, formally ISO 9362 Business Identifier Codes, specified no particular account format and carried no checksum, so a sending bank could not validate details before dispatch. Misrouted transfers meant delays and extra costs for sending, receiving and intermediate banks alike.
ISO published a fix in 1997 as ISO 13616, but the European Committee for Banking Standards judged it too loose and produced a leaner version that allowed only capital letters and fixed each country's length. The 1997 text was replaced in 2003, split into two parts in 2007, and updated again in 2020, with SWIFT as official registrar. Built first for payments inside the European Union, the system had spread to 89 countries by December 2024, including many in the Middle East and the Caribbean.
An IBAN runs to at most 34 characters: a two-letter country code, two check digits, and a domestic part called the Basic Bank Account Number of up to 30 characters. That domestic part bundles the account number, branch identifier, known as a sort code in the UK and Ireland, and any routing information. Each national central bank or payment authority sets its own layout, which must have a fixed length for that country, and registering it with SWIFT is optional. Only digits and the Latin letters A to Z are allowed, even where the national language uses another alphabet, as in Greece.
On paper, IBANs are usually printed in blocks of four separated by spaces, with a shorter final block, though electronic messages drop the spaces. A few countries break the pattern: Egypt uses no spaces at all, while Burundi, Libya and El Salvador group characters in their own irregular lengths.
Source: International Bank Account Number
