What do routing numbers mean

I Accept Show Purposes. Your Money. Personal Finance. Your Practice. Popular Courses. Part Of. Types of Checking Accounts. Checking Account Basics. Opening a Checking Account. Paying With Checks. Using a Debit Card. Best Checking Accounts. Business Checking Accounts. Banking Checking Accounts. What Is a Routing Transit Number?

Key Takeaways A routing transit number is a nine-digit number used to identify a bank or financial institution when clearing funds or processing checks. These numbers are also used in online banking and clearinghouses for financial transactions. Routing transit numbers are often used when setting up a wire transfer or direct deposit. Article Sources. Investopedia requires writers to use primary sources to support their work. These include white papers, government data, original reporting, and interviews with industry experts.

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The magnetic ink character recognition line MICR is the line at the bottom of a check that includes the banking account, routing, and check numbers. Understanding Checks A check is a written, dated, and signed instrument that contains an unconditional order directing a bank to pay a definite sum of money to a payee. How Account Numbers Work An account number is a unique string of numbers and, sometimes, letters or other characters that identifies the owner of the account. How Does a Checking Account Work?

The next four numbers in the sequence identify your bank—that is, they are the identifying number your bank is assigned, much like your own checking account number.

So from those nine digits, the check processing system can determine the federal reserve district and processing center, the financial institution the check is drawn on your bank , and specifically what type of financial instrument it is check or otherwise.

Related : What do credit card numbers mean? As mentioned earlier, setting up direct deposit of income tax refunds is one common need for bank routing numbers, but there are others where it may be necessary:. New employers typically ask for a canceled check from the institution you want the money deposited into because the check contains not only your checking account number, but also the routing number.

Both need to be precise—if the sequence if off by a single digit, your money will go someplace else. Anyone who has both numbers is in a position to not only to clean out your bank account, but also to engage in identity theft. Glen Craig is married and the father to four children that he spends the day chasing as a stay-at-home-dad. He took an interest in personal finance when he realized most of his paycheck was going toward credit card bills.

Since then he's eliminated his credit card debt and started on a journey towards financial freedom. I never really thought of the fact that giving a cancelled check is basically giving away your account and routing number even though deep down I knew that they were both there. Great post and info. I worked as a customer service representative for a credit card company and I learned everything I thought I needed to know about checks and checking accounts during our training.

Every time we pay with a check those number are printed tehre, so any one that receives a payment witha check can steal those numbers, banks would have not printed then there if it was that sensitive.

I guess scammers will need extra information to be able to engage in identity theft. I think anyone that have my account number can deposit but not withraw, unless they print fake checks, but again that can happen to anyone that pays with checks.

If you have one of your checks handy, you can find the routing number very quickly. No problem. Here are a few other ways you can find a routing number without a check so you can complete your transaction. Call your bank to speak to a customer service representative. You can count on them to give you the routing number or confirm the one you found online. Developed by the ABA, each routing number is publicly known and unique to one financial institution. However, one bank or credit union may have multiple routing numbers that are specific to different locations and various tasks that are being completed.

This is often the case with larger institutions. Essentially, a routing number is a bank ID that works with an account number to identify your account and make sure your money ends up in the right place. How We Make Money. Anna Baluch. Written by. Anna Baluch is a personal finance freelance writer from Cleveland who enjoys writing about debt, mortgages, student loans, personal loans and auto financing.

Edited By Brian Beers. Edited by. Brian Beers. Brian Beers is the senior wealth editor at Bankrate. He oversees editorial coverage of banking, investing, the economy and all things money. Share this page. Bankrate Logo Why you can trust Bankrate.