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Bank Key vs. Routing Number: Understanding the Differences

By Bank Deets · · Updated

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When it comes to managing finances, it’s important to know the differences between banking keys, routing, and account numbers. This is the case whether you’re setting up a direct deposit, transferring money between accounts, or conducting other financial transactions.

The terms ‘bank key vs routing number’ often surface, and they can be confusing. Both are codes that identify a bank rather than your individual account.

The short version: a routing number is the specific nine-digit code used in the United States, while “bank key” is a general term for whatever code a country uses to identify its banks.

Main Differences Between Bank Key vs Routing Number

The main differences between Bank Keys vs Routing Number are:

  • A routing number is a U.S. format, while “bank key” is a generic term that covers each country’s own bank code.
  • A routing number is always nine digits. Bank keys vary in length and structure from country to country.
  • Both identify the bank, not your account. Your account number is a separate piece of information.

Understanding Bank Keys

A bank key is a bank identifier used within a country’s payment system. It varies in length and structure, and unlike a U.S. routing number, it is not standardized to nine digits. Its purpose is to identify the bank during inter-bank transactions.

In many systems, the key works similarly to a routing number, helping to direct transactions to the correct institution. The term itself is common in business accounting software, such as SAP, where “bank key” is the field that stores a bank’s national code.

For example, in Germany, the bank key (“Bankleitzahl,” or bank sort code) is an eight-digit number. The Deutsche Bundesbank allocates these codes, and the code also forms part of a German IBAN.

Understanding Bank Routing Numbers

The routing number is also referred to as the routing transit number or the ABA routing number. It’s a nine-digit number that identifies your bank or credit union in U.S. payment systems.

Routing numbers are not assigned by the Federal Reserve. According to the American Bankers Association, LexisNexis Risk Solutions is the official registrar of ABA routing numbers.

The routing number locates the specific bank responsible for the payment of a negotiable instrument, such as a check.

Think of it as a sort of GPS for your money. When you’re transferring money to or from your account number, the routing number tells the banking institutions where to send it.

A large bank may have multiple routing numbers, for example tied to the region where an account was opened or to banks it acquired. Some banks also use a different number for ACH transfers and wire transfers, so always use the number your bank gives for the specific transaction.

Examples of Bank Keys and Routing Number

Bank Keys

  • In Germany, the Bankleitzahl (BLZ) system uses bank keys to identify banks.
  • In the United Kingdom, the Sort Code system uses a six-digit bank code to identify banks and branches.

Routing Numbers

  • In the United States, routing numbers identify banks in the ACH network and the Fedwire Funds Service, which handle transactions such as direct deposits, bill payments and wire transfers. The Federal Reserve publishes an E-Payments Routing Directory for these systems.
  • In Canada, a bank’s routing information combines a three-digit financial institution number and a five-digit branch transit number, according to Payments Canada.

Significance of Bank Keys and Routing Numbers

Bank keys and routing numbers make sure a payment reaches the right institution. Without them, banks would have no consistent way to route deposits, transfers and checks.

International transfers use additional identifiers. Payments Canada notes that SWIFT Business Identifier Codes (BICs) identify financial institutions in cross-border wire payments, and many countries also use IBANs to identify individual accounts.

These codes are not interchangeable. You wouldn’t use a German bank key in place of a U.S. routing number, or vice versa.

Conclusion

In conclusion, bank keys and routing numbers both identify financial institutions. A routing number is the specific nine-digit U.S. version, while a bank key is the general term for any country’s bank code.

Getting these numbers right helps ensure your hard-earned money ends up exactly where it should be: in your account. When in doubt, use the routing number printed on your checks or listed in your bank’s app or website.

FAQs

Are bank keys the same as routing numbers?

Not exactly. A routing number is the specific nine-digit code used to identify U.S. banks. A bank key is a broader term for whatever national code identifies a bank, such as the Bankleitzahl in Germany or the sort code in the UK.

What’s the difference between routing numbers and account numbers?

An account number identifies your individual account at a financial institution. A routing number is a nine-digit number that identifies the bank itself for transactions like direct deposits, ACH transfers and wire transfers.

Do I need bank keys for an international transaction?

“Bank key” is a field name used in business software such as SAP to store a bank’s national identifier. As a consumer, you usually won’t see it. For international transfers you’ll typically be asked for the recipient bank’s SWIFT/BIC code and, in many countries, an IBAN.

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