Use of a Bank Identifier Code (BIC) and International Bank Account Number (IBAN) are now mandatory for payments in euro within Europe.

Anyone making euro payments (credit transfers) across Europe was today (29 December 2006) reminded by APACS, the UK’s payments association, that as from 1 January 2007 banks across Europe will no longer be obliged to accept payments with incorrect, incomplete or missing beneficiary BIC and IBAN details.

BICs and IBANs are the internationally recognised identifiers, which act similarly to the domestic sort code and bank account number – their purpose is to standardise the information needed for efficient routing and delivery of payments across Europe.

Senders of a euro payment should obtain the beneficiary’s BIC and IBAN and include these details in the payment instruction they give to their bank.  Beneficiaries, for their part, should ensure they provide their own BIC and IBAN to the payment sender, for example by providing it on invoices and payment requests.

This change has been introduced by the European Payments Council (EPC), the decision-making and coordination body of the European banking industry in relation to payments.  It is an important step towards meeting the European Commission’s goal of creating a Single Euro Payments Area (SEPA) which itself aims to simplify the movement of electronic funds within Europe.  The Commission first raised the preferred use of IBAN for intra-European payments within EU Regulation 2560/2001, which mandated the provision of individual BIC and IBANs to customers.

Sandra Quinn, APACS Director of Corporate Communications comments:

“BICs and IBANs appear on all UK customer statements and should be provided to the payment sender in advance of the payment being made.  Whilst at the moment their use is only becoming mandatory for euro payments within Europe, it also makes sense to use them for all credit transfers in other currencies between the UK and Europe because they help reduce the scope for errors.  If anyone wants more information about their use, they should speak to their bank.”

Notes to Editors

1. A SWIFT BIC (Bank Identifier Code) is an 8 or 11 character identifier, which provides the routing information and branch identification in much the same way as existing domestic Sorting Codes.

2. An IBAN (International Bank Account Number) uniquely identifies an account held at a bank in an ever-growing number of countries. It is an enlarged version of the existing domestic account number to make it recognisable internationally. In the UK it is a 22-character identifier but IBANs issued in other countries may be of different lengths.

3. APACS is the UK trade association for payments and for those institutions that deliver payment services to customers.  It is also the banking industry voice on payments issues such as plastic cards, card fraud, cheques, electronic payments and cash.  It currently has 31 members, including the high street banks, major global banks, building societies, credit card issuers, the Royal Mail Group and the Bank of England.

4. In the context of this release, Europe refers to the 25 EU Member States together with Iceland, Norway, Liechtenstein and Switzerland.

5. The European Payments Council (EPC) is the decision-making and coordination body of the European banking industry in relation to payments and is composed of banks or banking associations representing all sizes and sectors of credit institutions across the market. Its purpose is to support and promote the creation of the Single Euro Payments Area (SEPA). Its focus is core payment services, both retail and commercial, in euro, throughout Europe. For more information, see http://www.europeanpaymentscouncil.org

For further information contact the APACS press office:

T: 020 7711 6316                         E: press@apacs.co.uk