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Bahrain's Central Bank said it has adopted the International Bank Account Number (IBAN) system, effective in the kingdom from January 2012, to speed up the transaction processes of payments.
The IBAN, an international standard for the numbering of bank customer accounts and accredited by the International Organisation for Standardisation (ISO), would serve customers in the kingdom starting from the end of January 2012, the central bank said in a statement.
The move towards IBAN would express bank customer account numbers in an ISO standard compliant format, the bank said.
"The use of such an internationally accepted format will immensely improve the efficiency of electronic payments and bring a number of benefits to bank customers," it added.
"Banks will be able to process a transaction efficiently and promptly through processing the IBAN of the recipient and will allow the bank customers to make or receive their payments much faster."
The number is a way of identifying a bank account which cuts down errors and delays in international payments with a lower risk of propagating transcription errors.
"The adoption of IBAN is a step to increase the efficiency of electronic payments in Bahrain," said Ahmed Buhijji, director of the Banking Services Directorate at the Central Bank of Bahrain (CBB).
The IBAN was originally developed to facilitate cross-border payments within the European Union, but the format is increasingly applied globally.
An IBAN committee, formed in early 2010, headed by the CBB and comprising representatives from the retail banks and the Bahrain Association of Banks, worked out the most desired IBAN format for Bahrain, in addition to its implementation timeline.
The IBAN format consists of 22 characters which comprise of letters and numbers.
A spokesman added: "The Central Bank of Bahrain commends the efforts and co-operation put forth by the banks in order to accomplish this initiative."
Banks will begin to issue IBAN to their customers in early September. Customers will then be able to use IBAN in making payments from January, 31, 2012.
