What is a routing number?
In the same way that every financial account is assigned a unique account number, every financial institution is assigned a unique routing number. These financial institution routing numbers are known as RTNs (Routing Transit Numbers) or ABA (American Bankers Association) routing numbers.
A routing number is a sequence of 9 digits. Small financial institutions typically have just one routing number, while larger multinational institutions can have several based on location. Routing numbers are issued only to federal- or state-chartered financial institutions eligible to maintain an account at a Federal Reserve Bank. If two banks merge, or one bank acquires another, the applicable routing numbers may change.
The first four digits of a routing number are called the Federal Reserve Processing Symbol.
The first two digits are typically a number between 01-12. These numbers refer to the head branch of the Federal Reserve District Office under which the bank falls. The Districts start with 01 in Boston and end with 12 in San Francisco and often encompass surrounding states. A range of 61-72 is assigned to non-bank payment processors and the number 80 to travelers’ checks.
The third digit identifies the Regional Federal Reserve Processing Center assigned to the bank within its district. For example, “1” would indicate bank check processing center 1.
The fourth digit indicates the bank’s location within a Federal Reserve District. A bank that is located in a Federal Reserve District is designated with a 0. Numbers 1-9 are used according to the state that the Federal Reserve District is in.
Digits five through eight comprise a unique identity code assigned to the bank by the American Bankers Association.
The final digit of the routing number is called a “check digit.” Whereas the other digits refer to identifying information about the specific financial institution, the check digit is calculated using the other eight digits as a way to ensure authenticity and prevent fraud. (Thus “check” is used in the sense of “verify” rather than “paper check.”)
Because no two financial institutions share all of the identifying information listed above, every routing number is unique.
