Opening up a bank account for your business can be an exciting time. It might mean you’re one step closer to hanging an ‘open’ sign on your cafe door or laying the foundations to start trading in the construction industry.
Whatever the reason you have for opening a UK business bank account - you need to make sure you understand how money will be paid in and transferred out. This can be done by familiarising yourself with your bank details, namely your business account number and bank's sort code.
Your account number is an eight-digit code unique to you, used to identify your bank account. Your sort code is the six digit number split into three pairs that identifies your bank, often adjacent to your account number. It might look something like this 11-22-33. You can find both of these numbers in various places like on your physical card, in your mobile banking app and on your bank statements.
In this comprehensive guide we’re going to focus on understanding ‘what is a sort code’ and how it’s used.
Contents:
- History of the sort code
- What is a sort code?
- What do the numbers mean on a sort code?
- Where can I find my sort code?
- Sort code checker
Quick history of the sort code
Interestingly, sort codes were created at the beginning of the 20th century. They were known by bankers and customers as the ‘National Code’, later referred to as ‘sorting’ codes. Their purpose was to assist in the manual processing of cheques.
Initially, large London clearing banks like the Bank of England and Lloyds Bank were given a single number between 1-5 as their National Code. Banks such as Scottish Clearing and Irish Clearing were issued numbers between 5-9. This was to specify whether a cheque was from outside the London clearing system. Smaller banks were initially assigned two digit codes but sorting codes have since evolved…
History of the branch code
What is a branch sorting code? Following the single or double-digit issued National Code, bank branches were allocated further digits. These were called branch codes or branch sorting codes. They would also sometimes feature on customer cheques.
The large London clearing banks like Lloyds Bank were issued just one digit after their main number. Metropolitan branches like Martins Bank were given two digits. Country branches outside London were often given three or more digits to feature after their main National Code number.
Every branch code would be unique. This was to avoid cheque-clearing mishaps.
Modern-day sort code
However, as more UK and Irish citizens started using banks, the number of cheque transactions increased and an automated system was eventually instated.
Alongside the automation, the National Code and branch codes made way for the standard six-digit sort code. It was officially introduced in 1957. Before the International Bank Account Number (IBAN) was adopted, countries like Germany used to utilise the sort code.
However, now only the UK and Ireland still use them.
While sort code is the correct name, you’ll also hear them being referred to as sorting codes throughout this guide. But don’t worry - they mean the same thing when discussing sort code banking.
What is a sort code?
In simple terms, a sort code is a unique string of six numbers. These digits identify both the bank and the individual branch you opened your business bank account at. To recap, this is the number typically on the front of your card that might look a bit like this: 11-22-33.
This ensures that banks can quickly and successfully identify where payments have come from. Its primary aim is to make sure money is paid into the right account. It also lets you make quick and easy payments on the go.
What do the numbers mean on my sort code?
Despite a name change, history hasn’t altered the format of the sort code too much. Your sort code features six digits and is made up of the bank code and the bank branch code. These have been split into pairs via the use of a dash.
My family member and I use the same bank. Why are our sort codes different?
For example, let’s say you opened your bank account with Halifax. A member of your family follows suit and also opens a bank account with Halifax. However, you have both opened accounts at different branches. If you compare sort codes, you will find they are slightly different. Only the first two digits (30) will match. The last four digits will be unique to the branch you opened your accounts in.
What happens to my sort code if my bank is branchless?
If you bank somewhere like Monzo or Starling Bank, you’ll notice that your sort code is the same as your friend or colleague who banks there, too. This is because these banks operate digitally. There is no physical branch for you to open your bank account at. Therefore, the first two digits and the final four digits of your sort code will be the same as others who use the digital bank.
Where can I find my sort code?
Now we’ve covered ‘what is a sort’ code - you might also want to know where you can find it.
We briefly touched on it at the start of this guide but there’s a variety of places where you can find your sort code. The easiest way to find your sort code is on your bank statements, in your app/online banking account and often on the card your bank has issued you.
However, you may find that some banks won’t include your sort code on the card they’ve issued you. This is sometimes for security reasons. It is also because digital banks like Monzo are branchless, and all feature the same sort of code. In these cases, your sort code should be readily available via their online banking platform.
Where is the sort code on my card?
You can usually find your sort code via the credit or debit card your bank has issued you. This is usually either on the front or on the back of your card. It often features alongside your unique eight-digit account number. Remember your sort code contains dashes, your account number will not.
Sort code checker
You can use a sort code checker to find and check various bank and branch sort codes. For example, if you’re making a payment and want to check you have the right bank, it’s a useful way to find out which bank a sort code belongs to. To use a sort code checker, all you have to have to hand is the sort code you want to research. However, be sure to type in the sort code without any dashes or spaces!
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