Bank Identification Number (BIN)

What is Bank Identification Number (BIN)?

Definition

A bank identification number (BIN) refers to the first four to six numbers reflected on a bank-issued card. The first digit of the BIN represents the Major Industry Identifier (MII) such as banking or airline while the next three or five digits represent the card issuer. The number identifies the card type, geographical location of the card issuer, and the bank or company that issued the card. It is the key piece to matching card transactions to the issuer of the card. BINs are also referred to as issuer identification number (IIN) considering that some cards are issued by other financial institutions apart from banks such as PayPal, Payoneer, netSpend and American Express. The overall purpose of the BIN is to protect both consumers and traders in the online market place.

Understanding BINs

The BIN is a financial concept developed by the American National Standards Institute and the International Organization for Standardization to regulate and identify bank card issuers. For every online financial transaction, a two-step process is usually required: authorization and clearance. The BIN covers the first step of the process which is authorization as it identifies the issuer (bank or credit card company) responsible for receiving authorization requests to determine the validity of the card and card limits placed on the card. The card issuer authorization process is made easy as the numbers are automatically run on a third-party service provider. Some e-commerce payment processors have a BIN list they are already subscribed to, thereby, making it easier to crosscheck the provided details by an online customer.