Implementing IBANs in the payment chain will involve the following steps:

1. An issuing bank provides the IBAN+BIC to its customers for accounts that are likely to receive payments from abroad. The IBANs are derived from the existing domestic account numbers of the customer.
2. The customer encourages the use of their IBAN+BIC by their trading partners, specifying it on invoices.
3. Customers instruct their bank to pay, quoting the IBAN+BIC provided by the beneficiary on the invoice.
4. The correspondent bank within the country of the beneficiary will recognise the payment as destined for that country from its country code. It extracts the domestic account format and uses it to complete the transfer.

The issuance of IBANs to UK customers

As a community, UK banks have decided that issuing IBANs is a non-competitive activity. UK banks have been issuing IBANs at their own pace, or on request from customers.

Processing IBANs on outgoing cross-border payments

IBANs are already being issued by some European banks to their customers. These corporates will request their UK trading partners to direct payments to IBAN-numbered accounts at any time now. It is anticipated that, over the next few years, IBANs will appear in increasing volume.

For more information on IBANs, please contact:

APACS
Standards and Security Unit
Mercury House, Triton Court
14 Finsbury Square
London EC2A 1LQ
Tel: 020 7711 6319
Fax: 020 7711 6299

The British Bankers' Association
Pinners Hall
105-108 Old Broad Street
London EC2N 1EX
Tel: 020 7216 8898
Fax: 020 7216 8958