A routing number is a combination of the five-digit transit number (branch number) and the three-digit institution number, which uniquely identifies the financial institution and branch associated with your account.
A routing number is used by banks, credit unions, and other financial institutions in Canada to process cheques and electronic transactions such as funds transfers, direct deposits, digital cheques, recurring loans and bill payments within Canada.
In this blog post, we will comprehensively explain what a routing number is in Canada, shed light on why you might need it, and guide you on how to locate your routing number.
What is a Routing Number in Canada?
A routing number in Canada is an 8-digit code consisting of a 5-digit transit number and a 3-digit financial institution number, usually found at the bottom of your cheques. Its primary purpose is to identify the specific bank branch where an individual holds their account.
Financial institutions across Canada, including banks, credit unions, and trust companies, rely on routing numbers to facilitate various transactions. These transactions include money transfers, cheque processing, direct deposits, loan transactions, and bill payments.
Routing numbers have been used since 1910 to streamline and expedite financial transactions. It was created to minimize the miscommunications and errors in the transfer of funds by assigning a unique number to each bank.
It’s important to note that your routing number is distinct from your account number. While your account number specifies which particular account and its associated transactions are yours, the routing number links your account to a specific bank and branch.
Your routing number contains two parts:
- The institution number – three digits – identifies your bank.
- The transit number – five digits – shows which branch you opened your account.
Here are some examples of three-digit institution numbers at major banks:
Bank | Institution number |
Bank of Montreal (BMO) | 001 |
Bank of Nova Scotia (Scotiabank) | 002 |
Royal Bank of Canada (RBC) | 003 |
Toronto Dominion (TD) | 004 |
Canadian Imperial Bank of Canada (CIBC) | 010 |
Fédération des caisses Desjardins du Québec (Desjardins) | 815 |
Routing Number Formats
The format of your routing number depends on the type of transaction, whether it’s an electronic funds transfer (EFT), such as direct deposit and automatic payments, or a paper-based transaction encoded with magnetic ink character recognition (MICR), such as cheques.
In both cases, routing numbers consist of two key components: the transit number and the institution number.
For example, if we use “12345” to represent the transit number and “789” as the institution number, here’s how these numbers appear:
- On a paper transaction, you will see it as 12345-789 for the transit number.
- For an electronic transaction, the routing number format is 012345789.
Why Do You Need A Routing Number?
Routing numbers are important identifiers that pinpoint your bank branch and its location. You’ve likely used your routing number on several occasions without even realizing it. Some common situations where you might need to use your routing number include:
- Setting up direct deposit with your employer.
- Arranging automatic and recurring loan and bill payments.
- Establishing direct deposit with the Canada Revenue Agency (CRA) for tax refunds or payments.
- Initiating transfers between two bank accounts.
- Conducting wire transfers.
How To Find Routing Number on your Cheque
If you need to find your routing number and have a cheque in hand, look at the numbers at the bottom, running from left to right. Your routing number can be found here.
Starting from the left, the first set of numbers is your cheque number. The next five digits form the transit number, and the final three represent the institution number. The routing number is essentially the combination of the transit and institution numbers.
Other Ways to Find Routing Numbers
If you find yourself in need of your routing number but don’t have access to a physical cheque, worry not, as there are alternative ways to obtain this essential information:
- Visit a local branch: If you’re away from your home city but can locate another branch of your bank, paying a visit to their cashier or teller should allow you to retrieve your account details. Be sure to bring identification to verify your identity.
- Go online: For the digitally inclined, accessing your routing number is as easy as logging into your bank’s website or app. You can usually find all the necessary information in the “Account Details” section. Additionally, downloadable direct deposit forms may also provide your routing number.
Is Routing Number Same As Transit Number?
Routing numbers and transit numbers are different numbers in the banking world, each serving a unique purpose.
Think of a transit number as the address of a specific bank branch, while a routing number is a combination that encompasses both the bank’s name and the particular branch location.
In simpler terms, the transit number pinpoints your bank branch, acting as its specific address, while the routing number goes a step further, identifying not only the branch but also the entire financial institution to which it belongs.
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- What is a Certified Cheque and How To Get One in Canada?
- How to Read a Cheque: A Guide For Canadians (2024)
- How to Write a Cheque in Canada: A 6-Step Guide
- What is a Void Cheque? How to Get One Fast (2024)
Final Thoughts on What is a Routing Number
Whether you’re setting up direct deposits, paying bills, or making transfers, knowing your routing number is a financial superpower you won’t want to be without.
These unique numerical identifiers, comprised of transit and institution numbers, play a pivotal role in ensuring your money reaches its intended destination without a hitch.
So, the next time you see those digits on the bottom of your check or statement, you’ll know just how significant they are in keeping your financial affairs in order.
FAQs on What is Routing Number
Is Routing Number Same As Institution Number?
No, a routing number is not the same as an institution number. A routing number is a nine-digit code that helps to identify both the financial institution and the specific branch associated with an individual’s bank account.
On the other hand, an institution number is a three-digit code that uniquely identifies the financial institution where your bank account is held. It is a part of the routing number, with the remaining five digits in the routing number serving as the transit number to identify the specific branch.
How do I Find my Bank’s Institution Number?
The easiest method is to search for your bank’s institution number online. It is typically readily available on your bank’s official website and within their mobile banking app.
Can Routing Numbers Change?
Routing numbers are not static and can change over time. These changes occur when financial institutions undergo various transformations, such as branch closures, adjustments in the routing number’s role, operational restructuring, or when they engage in mergers, acquisitions, or consolidations. In such cases, the routing number linked to your account may undergo a change.
