A virtual IBAN is a digital account identifier for an international bank account number. It looks exactly like a traditional bank number with a country code and standardized format, but it’s not generated from a physical bank account. Having a virtual IBAN account provides a way to accept payments from different countries seamlessly.
Virtual IBANs mean that accepting international payments is easier than ever before. There is no need to waste time setting up separate bank accounts for each country or region you deal with. Learn more about such accounts, as well as Genome’s virtual multi-currency IBAN accounts!
Virtual IBAN meaning
What is a virtual IBAN anyway? IBAN stands for International Bank Account Number. A virtual IBAN bank account serves as a unique identifier for an account linked to a master bank account.
It means that incoming and outgoing international payments can be made under unique identifiers. It’s a way of having multiple bank accounts without needing to open physical bank accounts each time. Customers can send to the same IBAN, or you can have different IBANs for each business segment or region.
It’s easier to track incoming payments and reconcile the items in this way. Rather than handling separate bank accounts where payments arrive separately, you can see everything under one master account.
How does a virtual IBAN work?
The process for opening a virtual bank account with IBAN facilities is simple.
The business opens a main account and requests a virtual IBAN linked to it. The currency can be set to meet the needs of the company. Several IBANs can be created to cover all the different types of payments received.
Give this virtual IBAN number to clients. They can send national and cross-border payments to it right away.
The incoming payments are automatically sent to your main, central bank account for you to check and reconcile. Real-time updates let you confirm as soon as payments have been received.
Genome has a streamlined process for creating and managing virtual IBANs. We provide multi-currency accounts in 12 currencies and allow generating dedicated virtual multi-currency IBAN accounts to send SWIFT transfers in these currencies.
Open an account
in Genome online
Virtual IBAN vs traditional IBAN: key differences
The differences between virtual and traditional IBANs help you see which banking services are right for you. Flexibility, multi-currency support, and speed are the key advantages offered by virtual IBAN providers.
Aspect | Virtual IBAN payments | Traditional IBAN payments |
Account creation speed | These digital identifiers are created by fintechs or other virtual IBAN providers instantly. Only one account needs to be opened, with virtual IBANs added to it. | This is likely to be a manual process that requires identity verification and could take several days. A new account is needed for each new IBAN required. |
Maintenance costs | Typically includes low costs for a virtual IBAN holder. | Higher fees are often charged in terms of account maintenance and transactions. Currency conversion fees can also be expensive. |
Global accessibility | The use of different currencies means that unique virtual IBANs can be used globally. | Accepted globally. Separate accounts may be needed to receive payments from multiple counties in the right currencies. |
Integration with business tools | Virtual IBANs are designed to work smoothly with other digital banking tools. | This is more likely to be a manual process with limited integration to other banking services and tools. |
Reconciliation benefits | Linking one or more virtual IBAN to a central account makes reconciliation easy. | Each IBAN belongs to a separate account, meaning that reconciliation has to be done manually over all the accounts. |
By understanding the difference between IBAN and virtual IBAN transactions, you can handle your overseas payments on business accounts more effectively.
Benefits of virtual IBANs for businesses
Using a virtual IBAN provides a range of useful benefits for businesses. The following are some of the key aspects to be aware of.
Simplified payment management
It is a simple way to handle multiple clients and currencies easily. Cross-border payments can be received into a central master account without any fuss.
Improved cash flow
The account holder’s bank account receives cross-border payments more quickly. Fast payment processing and settlements mean that there are fewer delays in international bank transfers to and from the main account.
Global reach
A virtual IBAN lets you receive and send international payments. These accounts can handle payments using SEPA transfers and international payments in multiple currencies. Multiple unique IBANs keep the funds from each part of the business separate.
Open an account
in Genome online
Better reconciliation
Digital payment service providers make it easy to reconcile the transactions that are automatically redirected to your account. You can assign a dedicated IBAN for each customer or revenue stream across multiple countries. With a regular IBAN, manual reconciliation is needed when payments are received.
Lower operational costs
Operating multiple accounts with a traditional bank can lead to a lot of transaction fees.
Multiple unique IBANs from fintech help keep fees low, even when you use various currencies.
Genome’s virtual IBANs give you these benefits with multi-currency support and full compliance. Our virtual IBAN works to make it easier for you to send and receive money in the way that best suits you. The online financial service provided by Gemome allows companies to avoid high fees while operating modern, global accounts.
How virtual IBANs support business growth
Opening the right virtual IBAN account is an important step towards strong business growth in the following ways.
Streamline invoicing, reconciliation, and financial tracking. It is an efficient way to handle your business account, with each transaction easy to track.
Expand into new markets. There’s no need to worry about opening local bank accounts when you plan to enter new global markets.
Give a stronger professional image. By getting a multi-currency account, you can have localized virtual IBAN accounts in currencies like US dollars, pounds, and euros.
Example of virtual IBAN use
We can see how this works by looking at an example. Let’s say a British company wants to expand into European countries that use the euro. They can link a single account to various virtual IBANs and receive international payments from Italy, Spain, and other countries into the same place.
If they want to expand into North America, they can request another virtual IBAN. It could be in dollars, meaning that funds are sent and received in the main currencies used.
Security and compliance with virtual IBANs
One of the key points is that virtual IBANs are held to the same regulatory standards as traditional bank accounts. Financial service providers need to ensure that they comply with the same regulations if they offer virtual and traditional IBANs.
It means that Genome complies with EU regulations, PSD2, and anti-money laundering (AML) / know your customer (KYC) requirements. This approach is based on secure infrastructure, data protection, and reliability. PCI compliance in a regulated cardholder data environment (CDE) means that card transactions are dealt with professionally.
Clients get solid fraud protection and can be sure that their accounts meet all of the relevant regulations.
How to get a virtual IBAN with Genome
The starting point for getting a virtual IBAN account is with Genome’s smooth onboarding process. Virtual IBANs are used to send international SWIFT transfers available for business clients. Thus, you will need a business account. At the same time, multi-currency accounts are available for both personal and business clients, allowing you to store and exchange funds in 12 currencies: USD, GBP, EUR, PLN, CHF, JPY, CAD, CZK, HUF, SEK, AUD, and DKK.
Create a Genome business account
It is a short process that lets you open a new account without any fuss or delay. Simply complete some basic details to get started.
Complete KYC
The know your customer requirements stage is where you need to provide the appropriate personal and company documents to start a business account. It ensures that the account meets all relevant regulations right away.
Request a virtual IBAN
You can now request a virtual IBAN to make international transfers. To make international payments, you need to use your business wallet and order account details to generate your dedicated virtual multi-currency IBAN account.
Start managing payments instantly
You can take advantage of all the benefits our multi-currency business accounts offer right away. Real-time updates confirm when payments are received. Make SEPA Instant and Credit Transfers, send out batch transfers, and, if necessary, start a merchant account to accept payments.
You can always order virtual and physical Visa debit cards and make contactless payments seamlessly in no time.
Open an account
in Genome online
The future of business banking with virtual IBANs
We’ve seen how virtual accounts are reshaping digital banking. Using online payment information allows us to send payments instantly across the planet.
Unlike traditional IBANs, they give companies a way to reconcile all their international payments online from a single account.
Future trends
The speed of change in the fintech sector suggests that we’ll see more innovations before long. A virtual IBAN makes it easier to reconcile payments in a single master account, but we can also expect artificial intelligence (AI) to make the payment reconciliation task even easier.
Automated accounting is another benefit that we can expect to see added over time. AI, machine learning, and the blockchain are among the types of technology that we can look forward to seeing make it even easier to manage your account.
Borderless banking is the movement towards instant, global banking that lets customers send and receive payments anywhere. It is a significant change that means real-time settlement for global businesses, with the use of multiple unique VIBANs likely to be a key factor.
As a trusted fintech innovator and licensed electronic money institution (EMI) provider, Genome is a payment provider you can rely on to handle your incoming and outgoing payments professionally.
