IBANs are an integral part of how payments are made globally. IBAN stands for International Bank Account Number; they are unique identification numbers that enable banks to determine an account and its country of origin.
This, in turn, ensures a payment gets transferred correctly to the right person or business.
What are virtual IBANs?
While regular IBANs are matched on a one-to-one basis with bank accounts, virtual IBANs (vIBANs) can process multiple payments into and out of a central bank account. It’s perhaps simpler to consider vIBANs as a sub-account of a master account.
If you’re receiving payments from many accounts with a single IBAN, you’ll normally require the sender to issue more reference information in order for you to identify them alongside your other payments.
If the payee forgets to include any reference information or makes a typo it can take time and, as a result, additional cost to identify where the money came from.
However, if you assign each payee with a unique vIBAN, the payee isn’t required to enter any additional information as it is clear where monies are coming from. The creation of these vIBANs is instantaneous, making them a more efficient method for businesses to monitor expected mass payments.
Learn how to navigate the challenges of cross-border payments.
Why vIBANs matter?
Sending and receiving international payments can be extremely costly. With vIBANs, businesses can accept payments in the currency of the payer and receive them into a local-currency bank account – cutting out FX charges that come from converting every single international payment.
As a part of our Mass Payments solution, we offer our BaaS clients vIBANs with the Master Account and vIBANs offered in: EUR, GBP, CHF, USD and PLN.
The main functionalities we offer:
- Master account (safeguarding/settlement account):
- Main account for batch booking of all funds processed from/to the vIBANs
- Virtual IBANs:
- Visible to end customer and always linked to master account
- Identify incoming and outgoing payments
- All SEPA schemes (SCT, SCT Inst & SDD)
- Internal payments
- Local payments for PL & SE
- Cross-border international
Cross-border payments and FX are common pain points for businesses that operate internationally, so having access to vIBANs can make a big difference to how you operate.
To learn more about vIBANs and what Vodeno can provide your business, arrange a call today.