What is a VIBAN?

VIBAN = Virtual International Bank Account Number

Breaking it down, an IBAN is a unique code (up to 34 characters) which identifies an individual bank account both locally and internationally, in a globally accepted standard.

From the IBAN itself, you can determine which country has issued the account, the bank the account is held with, alongside the account and routing numbers required to settle a payment. Each country has a different standard for account details but crucially an IBAN normalises these into one simple set of characters that can be used by most payment systems.

A virtual IBAN functions in the same way but instead of matching with a physical bank account, it is an identifier that works within a pooled account. VIBANs can have any name attached to them, regardless of the details on the pooled account, and can make payments look and feel like a transaction made directly from the sender. 

Why is this useful? VIBANs are used in cross-border payments to route transactions with ease - increasing bank acceptance rates by making transactions in the correct name, allowing for efficient reconciliation by segregating incoming and outgoing funds by customer on their own unique address, and creating a single multi-currency experience that does not reveal the number of pooled accounts required to transact across currencies.  

VIBANs remove the need to create individual physical bank accounts for each customer, a process which is often impossible when making payments in countries where your end user ultimately doesn't reside.

What are the benefits

Streamlined Reconciliation

With VIBANs, each customer is assigned a unique address, ensuring that their payments are easily traceable. This account structure eliminates the common issues of co-mingled transactions and incorrect payment references. Each transaction is easily identifiable, making financial reconciliation smoother and more accurate.

Transparent Transactions

One of the standout features of VIBANs is that they facilitate payments in the name of the customer, rather than the name of the pooled account. This ensures that payments appear to come directly from the customer, enhancing transparency and trust throughout the transaction process and increasing the acceptance rates at the receiving bank.

Quick and Flexible Setup

VIBANs can be created instantly (in bulk) and in an unlimited quantity. This promotes speed and flexibility as well as serving high-frequency use cases. It also reduces operational overhead of opening, maintaining and closing multiple physical accounts.

Multi-currency solution

A VIBAN allows payment companies with global coverage access to a multi-currency solution. A business can set up a single IBAN that accepts incoming and outgoing payments for various currencies. This increases customer satisfaction and reduces the operational load as payments can be made in a preferred currency to a single destination.