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Central Bank of Jordan IBAN ( ISO :International Bank Account Number). Agenda. Introduction IBAN Scope & Usage IBAN Structure & Rules. IBAN Parties Involved: CBJ, Banks & Customers. IBAN Implementation Milestone. (IBAN) Introduction.
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Central Bank of Jordan IBAN ( ISO :International Bank Account Number)
Agenda • Introduction • IBAN Scope & Usage • IBAN Structure & Rules. • IBAN Parties Involved: CBJ, Banks & Customers. • IBAN Implementation Milestone.
(IBAN) Introduction • IBAN stands for International Bank Account Number. It is the ISO 13616 international standard for numbering bank accounts. In 2006, the International Organization for Standardization (ISO) designated SWIFT as the Registration Authority for ISO 13616. • The IBAN concept was developed by the ECBS (European Committee for Banking Standards) and International Organization for Standardization (ISO) and is an internationally agreed standard (ISO 13616-1:2007) for identifying bank accounts. IBAN Standard is well known to banks and provider of payment systems in other countries. • Implementation of International Bank Account Number (IBAN) is an initiative of the Central Bank of Jordan.
(IBAN) Introduction … The IBAN Committee has been formed upon a NPC resolution in Jan 2013, to setup and implement the IBAN project in the Kingdom, taking in consideration the ISO IBAN standards.
(IBAN) Introduction … • The IBAN provides a unique world wide account number for each customer account, which allows sending and receiving Banks to validate the accuracy of the IBAN of the beneficiary. Accordingly, any Electronic Payment containing a validated IBAN could be credited easier to the beneficiary’s account. • The main objective of implementing IBAN is to facilitate Straight Through Processing (STP) of Electronic Payments by minimizing delays and extra costs associated with incorrect account numbers. • Over 60 countries use the IBAN standards. This includes all European Union countries, and some countries in the region such as Kuwait, Lebanon, Saudi Arabia ,Tunisia ,UAE, and Palestine.
(IBAN) Introduction … • The implementation of IBAN does not require changing the existing account numbers. Instead, the IBAN will represent the existing account numbers in a standardized format, which could be validated by Banks using one common ISO standard methodology.
(IBAN) Scope & Usage IBAN implementation will promote faster and reliable funds transfers between banks. The payment types included in the IBAN Project implementation in Jordan are: • Domestic Electronic Payments to and from bank’s customer accounts in Jordan. • Outgoing Electronic Payments from customer accounts of Banks in Jordan to customer accounts of banks/financial institutions in “Countries that have implemented IBAN” where the use of IBAN is mandatory. • Incoming Electronic Payments to customer accounts of Banks in Jordan from customer accounts of banks/financial institutions in “Countries that have implemented IBAN” as well as “Countries that have not implemented IBAN”.
(IBAN) Structure & Rules • IBAN consists of two components. The first component is the country code and check digit ,sometimes known as international envelope .The second component is the Basic Bank Account Number (BBAN). • International Envelope: 1. Two letter country code (CC): JO for Jordan. 2. Two-number check digit (CD) for the entire IBAN. Calculated according to ISO /IEC 7064 (MOD 97-10) Standard. Check digit feature ensures (by validation) that account number provided (to remitting bank) is correct. • Basic Bank Account Number (BBAN) : A Basic Bank Account Number (BBAN), no more than 30 characters long, consists of Bank Identifier (BI), branch codes and Bank Account Number (BAN). • IBAN has a unified and a fixed length per country.
(BBAN) Structure & Rules • BBAN (Basic Bank Account Number): The remaining part of the IBAN from the fifth character to the end character is known as BBAN. It is the domestic part of the IBAN which uniquely identifies an account number of a customer at his/her respective Bank in Jordan. The characteristics of the BBAN: • It has a fixed length (will be identified Later). • It consists of two parts: • Bank Identifier: The first 4 letters of SWIFT Code (BIC) or Bank Code identified by CBJ (Will be identified later). • Core Customer Account Number: is an account number which identifies the customer’s account at a Bank in Jordan.
Presentation Format of IBAN IBAN shall be represented in the following two formats: (a) Electronic Format • The IBAN shall be presented in the form of a continuous string of characters in Electronic Payment messages. Example:JO50CBJO0000000131000302 (b) Print format • Since IBAN is relatively long (for example, printed in the Bank account statements). The IBAN shall be divided into groups of four characters and printed in paper documents for readability. Each group shall be separated by a blank space of one character. Example:JO50 CBJO 0000 0001 3100 0302
Parties involved in IBAN Implementation (Central Bank of Jordan Roles) • Project Management and Implementation. • Purchase the original licensed copies of ISO 13616 and ISO/IEC 7064 (MOD 97-10) Standards. • Perform Jordan (IBAN- SWIFT) Registry Process. • Circulate Jordan (IBAN) formal structure and rules to operating banks. • Circulate project mandates for each milestone and phase. • Launch CBJ web based (IBAN) checker for public use and validate. • Prepare and circulate legal issues.
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) • According to IBAN international standard, the issuer bank is authorized to generate the IBAN for its customer accounts. • Update the banking systems to allow generation of IBAN numbers for their customers according to the IBAN structure in Jordan (Will be provided later). • Provide the existing and new customers with their IBAN on the date specified by the CBJ. • Update the banking systems to recognize payments received for their customers having IBAN numbers.
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) • Update the banking systems to add the IBAN number on the customer’s bank statement and anywhere required. • Provide different alternatives for the customers to receive their IBAN from the bank (e-banking system, customer support, etc.) • Issue marketing campaigns to explain the IBAN implementation in Jordan for their customers. • Update the banking systems to verify the validity of IBAN number for the outgoing transfers issued by their customers. If the payment has an invalid IBAN it should be rejected (this validation is done for payments for the countries implementing IBAN only).
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) Have marketing campaigns to explain the IBAN implementation in Jordan for their customers include:-. • Advise their customers, well in advance, that it is mandatory to use IBAN in payment orders/messages relating to customer Electronic Payments. • Advise their customers with the requirement to inform their IBANs to various parties from whom they receive and expect to receive payments, both, domestic and abroad. • Advise their customers that an incorrect IBAN will result in either crediting the payment to a wrong account or the payment being delayed/rejected.
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) Check Digit Generation and Validation • Banks shall use the scheme given in the ISO 13616-1:2007 [which is based on the scheme defined in ISO/IEC 7064 (MOD 97-10)] to generate and validate the check digits of the IBAN of a customer and ensure the accuracy of the check digits.
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) It is mandatory for Banks to validate the check digit of: • Domestic Electronic Payments to and from customer accounts of Banks in Jordan. • Outgoing Electronic Payments issued by Bank’s customers to customer accounts of Banks/financial institutions in “Countries that implemented IBAN” where the use of IBAN is mandatory. • Outgoing Electronic Payments issued by Bank’s customers to customer accounts of banks/financial institutions in “Countries that implemented IBAN” where the use of IBAN is not mandatory and the IBAN of the beneficiary is provided.
Parties involved in IBAN Implementation(Operating Banks in Jordan Roles:” CBJ Included”) It is mandatory for Banks to validate the check digit of: • Incoming Electronic Payments to local customer accounts issued by banks/financial institutions customers in “Countries that implemented IBAN” and “Countries that did not implement IBAN”.
Parties involved in IBAN Implementation (Notifying Banks Customers) • Banks must : • Provide customers with their IBAN. It is possible to get the IBAN from the bank statement or any other delivery channels such as: e-banking system, the ATM, or contacting the bank. • Request their Customers to provide IBAN to other parties that might issue transfer funds (Inside or outside Jordan).
Parties involved in IBAN Implementation (Notifying Banks Customers) • Banks must : • Request the customer to get the IBAN of the recipient (if the recipient account in a country implementing IBAN). • Use IBAN in transfer funds.
IBAN Implementation Milestone Project Milestone Phases (will be circulated) -Summary: • Phase 1: • IBAN preparation, regulation framework, and registration. • Phase 2 : • All banks must update their core-banking systems to : • Generate and notify IBAN to all their customers. • Use the IBAN. • Phase 3 : • IBAN will be formally used.
