What Is A Routing Number?

Routing Number

Routing Numbers are an essential part of the monetary transactions which is used to identify and differentiate each banking institution from another. A routing number, also referred to as RTN or ABA routing number, is asked from you whenever you make a transaction online or through the phone. The ABA routing number was designed originally to help the sorting, bundling and shipment of paper check back to the check-writer’s account. With the arrival of new payment methods like ACH and Wire, the system was extended to incorporate these methods too.

The Routing Transit Number is important for the Federal Reserve Banks when processing Fedwire funds transfer and for the Automated Clearing House to process direct deposits, bill payments, and other such automated transfers.

Routing Number

The People behind Routing Numbers

American Bankers Association had developed the Routing Transit Number system in 1910. In 1911, it partnered with Accuity (official Routing Number Registrar) to manage the system. ABA was founded in 1875 and today, it represents banks of all sizes and charters. This includes regional and money center banks, community banks, savings associations, mutual savings banks and also the trust companies.

The main tasks of American Bankers Association is lobbying, maintenance of the industry standards and best practices (routing numbers). Moreover, it checks for the professional development for member institutions, proper distribution of products and services, and consumer education. Accuity, on the other hand, is responsible for assigning all the new Routing Numbers and managing the RTN system.

Major Banks and their assigned routing numbers

A financial institution can be assigned up to five routing numbers as directed by the Routing Number Policy. But due to a lot of mergers between several financial institutions, they have more than five routing numbers. Currently, there are around 26,895 active RTNs in use across the country.

All the major banks operate through a network of bank branches and ATMs. These banks transfer funds among each other inside the country with the help of routing numbers. On this site, you can find the routing numbers for Wells Fargo and JPMorgan Chase banks. While there are 57 Wells Fargo routing numbers used by Wells Fargo Bank, JP Morgan Chase Bank uses 24 different JPMorgan Chase routing numbers to makes transactions.