A bank transit number, also known as a routing number, helps financial institutions identify where checks and other documents were issued from. They’ve been around for over 100 years, and they help to keep track of and facilitate transactions between customers at different banks.
You’ve more than likely had to search for your bank’s transit number. If you’ve ever set up a direct deposit or made a wire transfer, you needed to provide it. Read on to learn what a bank transit number is, how you can find yours and why they come in handy.
What Is a Bank Transit Number?
A bank transit number is commonly referred to as a routing number, or ABA RTN (American Banking Association routing transit number). A bank transit number is a nine-digit code that identifies a specific financial institution. Most of us will notice it from the bottom left corner of our checks. The transit number is printed on checks so other banks can determine which bank the check was first drawn from.
Every financial institution (including commercial banks, investment banks, credit unions, and brokerage firms) has a specific transit number. That number is on all negotiable instruments that issue from the institution. A negotiable instrument is a document that guarantees the payment of an amount of money; examples include a check, a promissory note or a bill of exchange.
The transit number is specific to the bank, not to you. So if you and a friend of yours both opened checking accounts at the same bank branch, then the routing number on both of your checks should be the same. The different number to the right is your account number.
How Do I Find my Bank Transit Number?
If you have a checkbook, the easiest way to find your bank transit number is to simply look at the bottom left corner of any check. Your transit number should be printed there. If you don’t have any checks, the transit number is still relatively easy to find. You can find the number by heading to your bank’s website, calling your bank branch or support line, or visiting your branch in person.
Big banks like Wells Fargo or Chase typically have a different transit number for each state it has branches in. In addition to having multiple numbers for different states, some banks have different transit numbers for different types of transfers. Some banks assign one number for paper transfers, one for electronic fund transfers (EFTs) and one for wire transfers, because they handle these transactions in different ways. If you’re unsure about which routing number you need, just call your bank and they’ll be able to direct you.
Why Do We Need Bank Transit Numbers?
The primary function of bank transit numbers has changed over time. When the numbers first arrived in 1911, their purpose was to help banks send the checks they received back to the banks that first issued them. This helped banks to keep track of their transactions – a necessity in the days before computers automated such transaction tracking.
Since then, the function of transit numbers has expanded to include both wire transfers and ACH network transactions. Direct deposits, for instance, wouldn’t be possible without transit numbers. The transit number helps to determine what bank the deposit is going to. From there, your individual account number helps specify things further.
Bank transit numbers are even more necessary today than they were in 1911. With over 28,000 different financial institutions across the country, many of them with remarkably similar names, transit numbers play a crucial role in keeping them distinct.
Bank transit numbers are essential to our banking system: With thousands upon thousands of transactions taking place every day, banks need a way to quickly identify each other. Thanks to those nine numbers, we can enjoy conveniences like direct deposit and online transfers. The next time you’re asked for a routing number or a bank transit number, you’ll know where to look and what you’re providing.
Tips for Banking Responsibly
- If you’d rather manage your money without having to worry about business hours or driving to a branch, you might be interested in online banking. Without having to travel to a traditional branch, you can conduct your business online in your own time. Plus, you’ll still be able to access a network of ATMs if you need cash.
- When dealing with any bank, it’s crucial that you make sure you’re not paying any sneaky fees. Unnecessary fees can cut into your savings and erase the benefits of using a bank in the first place. One way to avoid this is to look for a free checking account at your preferred bank. You can easily access your money without having to worry about losing any of it.
- Saving money isn’t always easy. Talking with a financial advisor can give you peace of mind that you’re on the right track. SmartAsset’s free advisor matching tool can match you with up to three qualified advisors in your area. Finding an advisor who fits with your goals can help you save more and prepare for your retirement the right way.
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