What is IBAN?
IBAN is the acronym for ISO 13616 standard compliant International Bank Account Number. IBAN is a unique customer account number which can be used confidently in making or receiving payments (excluding checks and credit cards) within the country as well as abroad. The confidence comes from two sources: the first is the internationally accepted standard for numbering bank customer accounts and the second is the ISO standard methodology for verifying the accuracy of the IBAN.
Why did the United Arab Emirates decide to introduce IBAN?
Introduction of the IBAN is a strategic initiative that will further align the UAE banking system with the evolving standards applied in other global banking systems. The adoption of IBAN is a step in the direction towards increasing the efficiency of electronic payments in the UAE, while further strengthening the country’s status as a global financial centre.
Who can create and issue IBAN?
Banks in UAE having customer accounts which are used for electronic payments are authorized to generate IBAN. No other party is permitted to generate IBAN for bank customers.
Who requires an IBAN?
Bank customers, who receive or make electronic payments in UAE or abroad, will require IBAN. If you have more than one account at your bank, you will require an IBAN for each of your accounts.
How can I get my IBAN?
Each of your account numbers will be converted into IBAN format from November 19, 2011, and you will be informed of the details by your bank. Your bank will also print your IBAN on your bank statement(s) starting November 19, 2011.
How would bank customers benefit from IBAN?
The main benefit of IBAN to the customer is the assurance of their transactions made to correct account to be processed efficiently and with no delay. Since banks check the accuracy of the IBAN at the point of initiating a payment, they can only make the payments which carry the correct IBAN.
Briefly explain the IBAN for UAE?
According to the ISO compliant IBAN Standard issued by the Central Bank of UAE, all IBANs have a fixed length of 23 characters.
IBAN has 3 components i.e. the Country Code, the Check Digit & the Basic Bank Account Number
The country code (first and the second characters of an IBAN) helps to identify and country where the account is resident. It contains the ISO two letter country code ‘AE’ (the ISO country code for the UAE)
The Check Digit (third and the fourth characters of an IBAN) helps to verify the IBAN internationally is always generated by a bank in UAE and helps in verifying if the account number is correct or otherwise
The BBAN helps to identify an account number of a customer, as well as his bank, domestically. It comprises the Bank identifier (which identi?es the account holding bank) and the customer account number. In the case of UAE, the Bank Identifier is the 3 digits following the Check Digits.
The remaining part of the BBAN is the existing customer account number. The length of the customer account number in the IBAN is fixed as 16 characters. It can ONLY contain numbers (0 to 9).
What is the difference between an IBAN and a normal account number?
An IBAN can always be distinguished from a normal customer account number by the following:
Two letters at the beginning of the IBAN, which refer to the country code where the account resides;
Two numbers (in the third and fourth position of the IBAN), which represent the check digit;
Three numbers (after the check digits) to identify the respective bank where the beneficiary maintains his/her account; and
The length of the IBAN is 23 characters.
Is there a standard way to write an IBAN?
When you write or print an IBAN on a document, it has to be split into 6 groups of four characters each, e.g.: AE07 0331 2345 6789 0123 456 to support easy recognition. The last group of the IBAN for a customer in UAE contains three characters.
There should not be any spaces when entering the IBAN in an electronic payment message. The IBAN should be presented in an electronic payment message as a continuous string of characters i.e. AE070331234567890123456
Does the existing account numbers become invalid with the introduction of IBAN?
No. Your existing account number will continue to be valid. IBAN is not a new account number. It simply represents the existing account number in an electronically recognizable ISO standard format. The adoption of IBAN in UAE does not require changing or replacing the existing account numbers.
For which transaction(s) can IBAN be used?
IBAN can be used for the domestic and cross-order payments. Additionally, the IBAN will be mandated for use in the Wages Protection System.
Is the IBAN to be used only for international payments?
No, Customers have to use IBAN in making and receiving international as well as domestic electronic payments.
What happens if we do not mention Beneficiary account as IBAN from November 19, 2011 onwards?
Banks will not reject such transactions from November 19, 2011 to April 12, 2012. However, it is likely that your transfer may get processed with delays and additional processing charges as may be prescribed from time to time.
What happens if we don’t mention Beneficiary account as IBAN after April 12, 2012?
Banks will not process and will reject such transfers if they do not contain a valid IBAN account number after April 12, 2012. Furthermore, there may be additional rejection charges applied to the transfer. This is only applicable for payments made to bene?ciaries in the UAE.