Bank state branch: Difference between revisions

A Bank State Branch (often referred to as "BSB") is the name used in Australia for a bank code, which is a branch identifier. The BSB is normally used in association with the bank account number. The structure of the BSB + account number does not permit for account numbers to be transferable between banks. While similar in structure, the New Zealand and Australian systems are only used in domestic transactions and are incompatible with each other. For international transfers, a SWIFT identifier is used in addition to the BSB and bank account number.

The use of the BSB identifier was introduced in the early 1970s with the introduction of MICR on cheques to automate the process of data capture by the banks as well as for mechanical sorting and bundling of the physical cheques for forwarding to the payer bank branch for final cheque clearance. This followed the introduction in the United Kingdom in the 1960s of a comparable system (there called a sort code). Since then, the use of BSBs has been extended to electronic transactions, but not in payment card numbering.

In Australia, the Australian Payments Clearing Association (APCA) is the regulatory body of cheque clearances and of the BSB codes in Australia. The BSB code consists of six numerals, the first two or three of which is a bank identifier. APCA assigns the bank code to a financial institution and the financial institution allocates the other digits to its branches, in line with guidelines set by APCA. Some financial institution have more than one bank identifier, arising from mergers or consolidating by banks of their trading and savings banks operations. As of March 2012, almost 14,300 unique BSB code values were in use.

In Australia, BSB codes are allocated by the Australian Payments Clearing Association (APCA). BSB codes are used in a number of payment systems in Australia:

Cheques are the least used form of non-cash payment in Australia,^[1] but the most by value. Financial institutions are required to include BSB and bank account numbers on cheques, at the bottom of the cheque in MICR form, which identify the specific bank account number to be debited. BSB codes are also used on deposit and other vouchers. Paper transactions are processed under the Australian Paper Clearing System (APCS) (also known as CS1) drawn up by APCA. Account instructions which do not have a BSB code must be processed manually.

Electronic fund transfers (EFT) are the most common method of non-cash payment in Australia. EFT transactions between bank accounts use the Direct Entry system. For transfers using the Direct Entry System, BSB and bank account numbers must be given for the accounts to be debited as well as for the account to which funds are to be transferred. Electronic transactions are processed under the Bulk Electronic Clearing System (BECS) (also known as CS2) drawn up by APCA. BSBs are not used in transactions involving payment cards, such as credit cards or debit cards, nor in BPAY transactions.

For incoming international transfers, SWIFT codes are used in addition to the Primary Bank Account Number (BBAN), which comprises a BSB and bank account number. There is no public discussion of the adoption of IBAN identifiers for incoming international transactions. Any process towards IBAN would involve considerable changes to bank software and computer systems. Outgoing international transfers must use either the SWIFT or IBAN system in use in the destination country.

The format of the BSB code originally was for the first two digits to indicate the "bank" and the other four digits to specify the "branch" of that financial institution. In Australia, the major banks have at least historically structured their branch codes with the first of the four digit branch code indicating the state where the branch was located. Some of the larger banks have two bank codes. This is largely historic, a legacy from the time when banks maintained separate trading (cheque) and savings bank entities. The first digit of the bank code was either 0 (for trading bank accounts) or 1 (for savings bank accounts), with a common second digit. For example, 03 was for Westpac's trading accounts, while 73 was for Westpac's savings accounts. This distinction is now of only historic significance.

For example, the Australian BSB code "033088" breaks down to:

• 03 = Westpac Banking Corporation, historically the trading operation
• 3 = Victoria
• 088 = 383 Chapel Street, Prahran

With the creation of many new financial institutions in Australia, the structure of the BSB has been modified. While banks generally still follow the traditional state branch structure, building societies and credit unions often do not; this is because many of these institutions use an intermediary; for example, BSBs such as 80xxxx are administered by Cuscal where as 704xxx is administered by Indue. In these situations, the building society or credit union is identified by the 'state' and 'branch' components of the BSB whereas the 'bank' refers to the intermediary. Depending on the intermediary used, building societies (both current and former) BSBs generally start with 63xxxx and most credit unions BSBs will use the either 704xxx or 80xxxx. The state code structure is not always used in these situations; for example, Bendigo Bank started as a building society in Victoria but now uses a single BSB nationally (633-000) while the Queensland-based Heritage Bank, also a former building society, uses 638xxx. Some institutions such as Suncorp uses 484-799 for all deposit accounts regardless of which branch or state the account was opened in.

Furthermore, recent changes within Australia's banking environment have allowed larger building societies and credit unions to establish and 'own' their own BSBs, even if they are using an intermediary. Owning a BSB allows a financial institution to create new products and offer additional services.

The major banks structure their BSB codes according to States. This is largely historic and have only limited significance in electronic banking. For those who maintain State codes, the State code is the first of the four digit branch field and are:

• 2 - Australian Capital Territory, New South Wales
• 3 - Victoria
• 4 - Queensland
• 5 - South Australia, Northern Territory
• 6 - Western Australia
• 7 - Tasmania

• Bank card number
• ISO 9362, the standard for SWIFT codes, international bank identifiers
• List of banks in Australia
• New Zealand bank account prefix
• Routing transit number
• Sort code, a number used in the United Kingdom and Ireland that is similar to the BSB

• Australian Payments Clearing Association Limited (APCA), the body that regulates BSB numbers
• Look up BSB Numbers on the Official APCA web site (constantly updated)