Central Bank introduces IBAN for overseas financial transactions |14 May 2016

The Central Bank of Seychelles in collaboration with local commercial banks including the Seychelles Credit Union, will introduce the International Bank Account Number for financial transactions undertaken with overseas institutions as from October this year.

International Bank Account Number (IBAN) is an international standard that identifies bank accounts. It minimises the risks of human intervention during a financial process, of transmitting errors during overseas payments process and takes less time in processing a financial transaction.

IBAN is used worldwide and in jurisdictions that have made it mandatory to use it in any financial process.

“IBAN is being used internationally. There are even certain jurisdictions, especially in the eurozone area which after the establishment of a new regulation in 2012 made it mandatory for all parties transacting in euros with them to have an IBAN account by October 2016.

In such jurisdiction if an account holder is not IBAN compliant,  it can either refuse the financial transaction or do it manually which may cause delay or higher surcharge,” said Liz Julienne, Senior payment systems officer, Payment Systems Division of the CBS when explaining the process with the press yesterday at her office.

Ms Julienne also said due to these new developments, CBS and other local banks have taken the decision to introduce IBAN to the Seychelles account holders.

“This means that all account holders, be it businesses or individuals, will be transformed on the IBAN standard. When the commercial banks are ready with the transformation of old accounts to IBAN standard, clients will be notified,” she added.

There will also be a process to educate account holders on how the IBAN works. It is worth noting that domestic transactions will not be affected. Overall account holders will as from October use their new IBAN standard accounts for any overseas transaction.

The process to transform bank accounts to IBAN standard consists of adding certain bank codes to the existing account numbers.

“There will be new elements added to current account numbers like the Country Code (sc), Check Digit that also needs to be added to enable an overseas transaction; SWIFT Code; Bank Code which identifies which bank you are using; Branch Code to identify the specific branch of the bank; the client’s bank account itself and at the end the type of currency you are dealing with (eg: euro, dollar etc…).

“All banks’ customers will be contacted in due course to be notified of the change in account numbers. There should not be any charges on the process as IBAN registration by CBS was free of charge. But if banks feel they have to charge something, it should be published in the fees and charges regulations,” explained Ms Julienne.

As commercial banks have been involved in the procedure since the beginning, CBS said they are committed to be IBAN compliant by the given time span.