Exact Meaning Of Bin

A bank identification number or BIN is a 6-digit number that identifies the card issuer within the payment system during authorisation and processing.

In the payment processing cycle, the BIN is used to determine which bank the authorisation request should be directed to, the type of card used, the geographic location of the bank, and other useful information.

Each digit of the bank identification number carries the information necessary to authorise and process card transactions.

Aside from banks, other financial institutions are also empowered to issue cards. That’s why BIN is also known as an issuer identification number (IIN) there are some easy ways to search bin with the help of bin search.

How bank identification number works

Every time a customer swipes their card or enters the card details to pay, the issuer receives an authorisation request to confirm that the bank account is valid and has enough funds to withdraw. 

The BIN system was developed by the International Organisation for Standardisation (ISO).

Collaboration with the American National Standards Institute (ANSI) as a way to identify institutions that issue credit, debit and other types of bank cards.

Since the bank identification number is used to cross-check information between card networks, banks, and other financial institutions, the average user rarely interacts with the BIN. 

Most often, it’s simply entered during the checkout along with the full card number to complete an online transaction.

Why is a bank identification number important?

Bank identification number helps merchants and card networks quickly check all important information needed to process the payment, in particular:

• Card network
• The bank or financial institution that issued the card
• Card type (credit, debit, prepaid card, gift card)
• Bank card category (Classic, Gold, Maestro, Standard, Platinum)
• Card issue country and the bank’s location

Verifying the above points helps the payment system protect against card fraud and process transactions smoothly. In addition to identification purposes, a bank identification number is often used by merchants to analyse processed payments in terms of geolocation and payment method used. 

For example, if you know that a large number of payments are made using the cards of a particular bank, then it makes sense to cooperate with it to ensure cost-efficient payment processing.

Here’s what industries the MIIs represent:

0: ISO/TC 68 Assignment

1: Airlines

2: Airlines and other industry assignments

3: Travel and Entertainment + American Express cards

4: Banking (Visa)

5: Banking (MasterCard)

6: Merchandising and Financial + Discover cards

7: Petrol industry

8: Health Care and Communications

9: National Standards Bodies

Other digits

The rest digits of the bank identification number are generated by the payment system as a unique set of numbers that designate an individual card account. 

These digits cannot match with other card numbers issued by the same institution. It is possible for each card issuer to generate a trillion of unique numbers for their clients.

For bank cards, the fifth and sixth digits are assigned in accordance with the bank card category. For example, Classic, Gold, Maestro, Platinum, etc.