The use of electronic communication media and services internationally for the cross-border transmission of information and payment and payment-related transactions between financial institutions, as well as between financial institutions and their customers, continues to increase. In order to facilitate automated processes in support of straight through processing (STP) in this environment, ISO 13616 has been developed by ISO/TC 68/SC 7 as a means by which financial institutions and their customers can exchange, through inter-industry electronic data interchange (EDI), customer account identification details in a machine-readable form. It also makes provision for validation of the information provided.
In developing ISO 13616, it was recognized that a single, universal method for identifying the account and banking relationship for customers of financial institutions was not practical. Accordingly, ISO 13616 recognizes that financial institutions would wish to retain, wherever possible, their current national identification methods. It therefore provides a method whereby a minimum amount of change to existing systems is required and, at the same time, proposes a means of structuring the information in a way that promotes automated processing of the information provided.
It is anticipated that the use of ISO 13616 in electronic data interchange will:
a) reduce the need for manual intervention in the processing of inter-industry and intra-industry data interchange,
b) improve the level of confidence in the accuracy of the information provided, and
c) provide certainty that the information provided is relevant to the country of ownership of the account.
It is recognized that the IBAN would also be of use in a paper environment. The use of information to further qualify details of the financial institution at which the IBAN applies is not precluded by their use outside of the IBAN.