GeneralCorporate BankingMoney servicesQuestions and answersList of terms

List of terms


1. IBAN - what is it?


IBAN (International Bank Account Number) is literally the international bank account number, i.e. Customer's account number in the financial institution according to the international standard ISO13616.


The necessity to introduce this account number format was due to the European Committee decisions for banking standards (ECBS) in order to quicken the payments processing, as well as to acquire a greater degree of automation and thereby reduce payment processing costs.


In different EU countries the size of the IBAN account number may differ: Latvian IBAN account consists of 21 alphabetic and numeric characters. However there are IBAN account numbers consisting of 16 characters (Belgium) and 34 characters (Malta). Mandatory elements of any IBAN accounts are:


  • country code consisting of 2 letters
  • two-position check digit
  • 4-digit bank code
  • Customer's Bank account number


The correctness of the IBAN can be checked using a special calculator on Industra website, or by contacting the account operator.


From January 1, 2007, the IBAN code is the only identifier of the account for the recipient of the credit transfer, who has a bank account with the EU/EEA (European Economic Area) bank, regardless of transferred currency. European banks are entitled to refuse from commencing the credit transfer if the account number does not match the IBAN format, and banks additionally may retain their commission fees when returning the money to the payer.


2. OUR, SHA - what is the difference between these commission options?


According to the SWIFT international standards, the following commission designations are used during the execution of the MT103 Customer's transfer order:


  • OUR - All payments for the transfer are made at the expense of the paying Customer. The amount of the commission includes not only the commission of Industra, but also the assumed commissions (or part thereof) of third parties. During the credit transfer Industra sends a message in SWIFT MT103 format with a mark "OUR" in the field "Details of Charges", charging all parties involved in funds transferring to pay the full amount of the credit transfer to the beneficiary. Responsibility of Industra is limited to the execution of this condition. Industra is not liable for failures of any of the parties involved in the credit transfer to execute orders of Industra, as well as for the fact that due to reasons beyond control of Industra(for example, the rules of credit transfers execution in a particular country) the credit transfer was not received in full
  • SHA - All costs incurred by the sender of the MT103 message are at the expense of the paying Customer and all costs of the recipient of the MT103 message are at the expense of the receiving Customer. Practically this means that the paying Customer pays only Industra commissions. All the commissions of the third parties (correspondent bank, intermediary bank, beneficiary bank) are paid by the receiving Customer. While executing the credit transfer Industra sends SWIFT MT103 message with a mark "SHA" in the field "Details of Charges". The amount of the credit transfer credited to the beneficiary's Bank account is reduced by the amount of withheld commissions of the third parties (if any)


3. Settled payment - what is it?


Settled payment is a payment that meets the following criteria:


  • Amount of payment does not exceeds EUR 50 000,-
  • Beneficiary's account is specified in IBAN format
  • Beneficiary's Bank is mandatory specified in the SWIFT or BIC format
  • Banks participating in the payment (the payer's Bank, beneficiary's bank, intermediary banks) are the residents of EU countries
  • Commissions option - SHA


According to the Regulation of the European Parliament and Council of December 19, 2001, No. 2560/2001 on "Cross-border EUR payments" the limits are established for resident-banks of EU countries concerning the withholding of the commissions during the execution of international credit transfers in euro: the commission retained by the Bank during the execution of the so-called settled payment must be equal to the commission for a similar payment within the country. Thus, the only case in which a commission from the settled payment may be retained is if the Bank involved in a credit transfer will charge the same commission for payments within the country, and that's rarely happens in practice.


4. STP payment - what is it?


This is the payment, which can be executed by using the Straight Through (Automatic) Processing technology (STP), thereby lowering the costs related to the execution of payment. It is obvious that the main criteria of STP are existence of machine-readable identification codes of the banks participating in the transfer and the IBAN (if any). For the bank customer this means that upon submitting the payment order to the Bank it shall ensure (in respect of beneficiary's Bank, as well as other participants of the transfer, that are deemed by the Customer to be involved in the transfer) the existence of the Bank's full name, address, city, and country. This full information allows the bank employee to search in the international databases when processing the order and to select the code of this participant by unmistakably identifying this participant.


AS "Industra Bank" Head office
57 Elizabetes Str., Riga, Latvia, LV-1050

Ph.: +371 67019393
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