The Bank Identifier Code, also known as a BIC or BIC code, is a universal method of identifying financial institutions in order to facilitate the automated processing of payments. Used to route cross-border (and some domestic payments) to a branch or payments centre, a Bank Identifier Code can handle the relevant transaction.
A BIC code consists of eight or eleven continuous characters comprising:
| Bank Code |
4 alphabetic characters identifying an individual bank, for example “DEUT” identifying Deutsche Bank |
| Country Code |
2 letter ISO country code such as DE for Germany |
| Location Code |
2 alphanumerical characters (except zero) identifying the location of the institution within the specific country such as FF for Frankfurt |
| Branch Code |
3 alphanumeric characters, (optional) identifying the specific office or branch |
Example of a Bank Identifier Code
In order to facilitate a straight through cross-border payment, two identification codes are required: the Bank Identifier Code of the receiving bank and the beneficiary’s International Bank Account Number (IBAN). BICs and IBANs are used together to concisely identify the location of a specific account and as such are the key information required in enabling a payment to benefit from STP*. In many cases, the Bank Identifier Code can be derived from the domestic account details. In the EU the CREDEURO convention** requires both the Bank Identifier Code and the International Bank Account Number to enable customers to benefit from reduced transaction costs.
Further information:
* Straight Through Processing
** The Credeuro Convention establishes a standard for the execution of a “basic” bank-to-bank pan-European credit transfer, which allows participating banks to give guarantees to their customers as regards information requirements, execution time and remittance information transmitted.