Ben Todd | Jun 2, 2017 | 0
What Is The Transit Number?
What Is The Transit Number? It is a nine-digit code that is used in the US. You will probably recognize it from the bottom of your checks. The transit number is also called the ABA RTN number, or the ABA routing transit number. It is used to identify the bank or institution from which it was drawn.
Let’s Get A Little Less Technical
What is the transit number? It is the number that you see running along the bottom of your check. It is used to tell the other banks which bank it first came from. The image below shows you where the transit number is usually located on your checks.
Let’s Get A Little More Technical
The statement made above is correct, but it is a little restricted. As you know, banks are not the only institutions, and checks are not the only things that contain transit numbers. Here is a more technically-correct explanation of a transit number.
The ABA RTN (ABA routing transit number) is made up of nine digits. A routing transit number is the name given to the ABA RTN in the United States.
The number appears on negotiable instruments, and it is usually placed near the bottom of a negotiable instrument. The ABA RTN identifies the financial institution that created it, that issued it, and/or that drew it.
What Is A Transit Number – Here Is An Example
For example, if you wandered into People’s United bank and got yourself a cashier’s check, the ABA RTN number would run along the bottom. The number would indicate that the Cashier’s check came from a People’s United bank.
In the image below, you can see a series of numbers running along the bottom. The number of the left is called the check number. The number in the middle is the transit number, and the one of the right is the account number.
Transit Numbers Appear On Negotiable Instruments
Let’s consider an example with a credit union. If you have a CEFCU checking account and you have a checkbook, then you should see the ABA RTN (transit code) for CEFCU on the bottom of the check. The transit code is the same on all CEFCU checks, be they yours, or be they your friend’s who also has a CEFCU checking account. The number does not change because it identifies the “Caltech Employees Federal Credit Union” and not the account holder. The image below shows a CEFCU check with the routing transit number.
The routing transit number used to work a little like a postcode/ zip code when banks were sorting paper checks in their offices. These days we have wire transfers and ACH transfers, so the ABA RTN has been expanded to fit these electronic methods of money transfer.
A Little History And General Knowledge About Transit Codes
The Federal Reserve Banks and the other 40% owners of the ACH transfer network are able to use the transit number to process funds transfers. When you buy something with a check, the transit number helps to make sure that your payment goes to the correct bank and then to the correct bank account.
People are able to use mobile check deposit and check scanners these days to deposit funds, and those tools are able to read the transit number off of checks so that the money may be transferred to the correct financial institution. The ABA RTN code system was invented by the American Bankers Association in 1910 and it is still in use today.