Check Routing Number Info
Have you ever wondered what that 9 digit number is in the bottom left-hand corner of your checks? Many people have this question. In fact, almost 50,000 people search for routing number related terms in search engines every month.
The ‘routing number’ is also referred to as a ‘transit number’ or ‘aba number.’ It consists of a 9 digit code and it is utilized in the United States of America. The soul purpose of this number is to determine the bank or financial institution from which the money referred to on the check is to be withdrawn.
With so many banks in existence today, this number is very helpful to the bank taking a deposit of a check in determining where they need to get the money. It was once a difficult task to determine where checks were written from. In fact, this difficulty has historically been exploited by criminals to commit fraud against banks.
Therefore, this numerical system was developed to streamline and clarify the process for clearing houses and for banks. This has helped in the honest transfer of money between banks on behalf of their customers for years now.
This system has even been modernized. The serialized number makes it easier for computers to understand and use the information and as recently as 2004 it has been used to transfer electronic checks also known as echecks or EFTs (electronic funds transfer). This began with the passage of the Check 21 Act which has helped to reduce the reliance on paper checks by making it permissible to make digital copies of checks.
This useful number system dates all the way back to 1910 when the American Bankers Association (ABA) devised it to help interbank relations. It has been used ever since to help the banking industry to run smoothly.
Can you imagine trying to keep track of over 26 thousand different banks that issue checks? As a banker you would be overwhelmed with work trying to figure out where to get your money! This is exactly the problem that the ABA has successfully helped to solve since 1910.
About 26,895 routing numbers are actively in use in the United States of America today. This is because every financial institution must have one by law. That means that every bank needs to have an ABA number issued to them before they open their doors.
The check routing number is an important development in the history of banking. It has helped to improve the efficiency of banks. It has helped improve the security of banks. It has even helped improve the way we transfer money over the internet.
Check Routing Number Info
Please comment below if this was helpful or if you need different information!