P2P Trading via IBAN: Comprehensive Guide from A to Z

What is IBAN and Why Is It Important?

In the digital transformation era, What is IBAN is a question that more and more people are asking. IBAN (International Bank Account Number) is an international standard for identifying bank accounts. This system is widely adopted in most countries worldwide to ensure that payment transactions occur quickly, accurately, and securely between different banks as well as across national borders.

In Ukraine, IBAN became a mandatory standard from 2019, marking a significant step forward in modernizing the financial system. The introduction of IBAN has brought many conveniences to users, from minimizing errors in transactions to speeding up money transfers.

What is the IBAN Structure - What You Need to Know?

Each IBAN code consists of 29 characters arranged in a specific order. Understanding this structure will help you verify accuracy before making a transaction:

• UA is the country code designated for Ukraine
• Two check digits serve as validation, helping to detect any input errors
• Bank code to identify the financial institution where the account is opened
• Unique account number to precisely identify the recipient

For example, a standard Ukrainian IBAN: UA1234567890123456789012345678

How IBAN Is Formed for Different Entities

The process of creating an IBAN is not arbitrary but follows specific rules. For each type of entity, the system uses different identification codes:

For individuals: Using the RNOKPP code (personal identification code) consisting of 10 digits, previously called TIN (Tax Identification Number).

For legal entities: Applying the EDRPOU code (unique legal entity identifier) with 8 digits.

These codes not only help accurately identify the sender and receiver but also ensure that funds are transferred to the correct person and account.

Step-by-Step Guide to P2P Transactions via IBAN

P2P (peer-to-peer) transactions are direct payments between two individuals, from one account to another without any intermediary. Here is the detailed process:

Step 1: Obtain the correct IBAN information from the recipient. You can find the IBAN in their banking app or request it directly. This is the most critical step because a small mistake can send money to the wrong place.

Step 2: Carefully verify each character of the IBAN before confirming. Every digit, every letter must be correct. No corrections can be made after the transaction is sent.

Step 3: Clearly specify the purpose of the payment. This information helps both parties track the transaction and serve as proof. The purpose could be: bill payment, service fee, or any other reason.

Step 4: Execute the transaction via mobile banking app or ATM. Most Ukrainian banks now have convenient apps that allow quick and easy IBAN payments.

Benefits of Using IBAN

The IBAN system offers many improvements over traditional payment methods. Currently, all banks participate in the modern electronic payment system, allowing IBAN payments from 1:30 AM to 10:30 PM daily, even on weekends.

High accuracy: The standardized IBAN structure significantly reduces the likelihood of errors, protecting your assets.

Fast transactions: During operating hours, transactions are usually processed within an hour, very convenient for both domestic and international transfers.

Integrity: The automatic validation system helps confirm the validity of information before recording.

When Transactions Are Delayed - What Should You Do?

If after one hour the money has not arrived in the recipient’s account, don’t worry too much. It’s best to wait until the end of the business day for the system to complete processing. Bank staff may need additional time to verify transaction details.

If it remains pending after a day or if any issues arise, contact your bank’s customer service immediately. They will help you check the transaction status and resolve the issue as quickly as possible.