Canadians send money abroad, both for personal and professional purposes. In fact, Payments Canada found that nearly 17% of Canadians send money abroad regularly, sending 5.3 payments a month on average with a total average payment amount of $1,156. While Canadians choose non-banking alternatives like Wise orPayPal, 27% still use traditional banks and credit unions to send their funds.
No matter how you send your money and what method you rely on, A big part of sending money is knowing your routing number. We look at what it is and why it’s used to send and track your payments.
What Is a Routing Number in Canada?
Financial institutions use routing numbers to process transactions like money transfers, cheques, direct deposits, loans and bill payments. You’ve likely encountered your routing number when you’ve started a new job and the company needs the requisite information to set up direct deposit. They may have asked you directly or required you to provide a void cheque.
Essentially, Canadian banks and other financial institutions use routing numbers to identify their individual branches. To create routing numbers, banks combine the five-digit transit or branch number (where you opened your bank account) and the three-digit financial institution number.
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 |
| Canadian Imperial Bank of Canada (CIBC) | 010 |
| Fédération des caisses Desjardins du Québec (Desjardins) | 815 |
Routing Number Formats
How a routing number appears on transactions depends on the type of transaction. If it’s a direct deposit or another type of electronic payment, the routing number has a leading zero because some banks have nine-digit account numbers. So, it will read 012345678 with nine numbers.
If it’s a paper transaction, it will have the eight numbers, split with a dash: 12345-678.
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What Is the Purpose of a Routing Number?
Routing numbers carry a lot of information, such as the specific financial institution and the transit or branch number. When you combine the routing and your bank account number, it creates a unique address. Financial institutions can identify and track the movement of funds. That’s why it’s so important to make sure the numbers are accurate.
How to Find a Routing Number on a Cheque
If you have a cheque, you’ll see a series of numbers on the bottom, running from left to right. That’s where you can find your routing number.
Reading from the left, the first set of numbers is the cheque number. The next five numbers make up the transit number and the final three are the institution number. The routing number is the combination of the transit and institution numbers.
If you don’t have a cheque, you can look it up via your online banking portal.
How to Find a Routing Number Without a Cheque
You might be thinking, ‘Who still uses cheques these days?’ According to the Bank of Canada, 26% of Canadians still cheques, so they can get their routing number from there. If you don’t use cheques, there are several ways to still find your routing number.
- Your paper or electronic bank statement.
- Your online banking will often have your transit/branch and institution number or will provide a digital cheque which you can copy or download.
- You can call or go into your bank and ask for the number directly.
What’s the Difference Between a Routing Number and a Transit Number?
As we’ve covered, routing numbers and transit numbers are different things. Transit numbers are part of routing numbers. A transit number is like the specific bank branch’s address, but a routing number combines the name of the bank plus the specific branch.
Bottom Line
Routing numbers are an important part of sending or receiving money, whether you’re sending money to family, getting paid by a client or getting your salary via direct deposit. Using this identifier ensures your money goes to and arrives in the right bank account. And you don’t need a physical cheque to find your number.
Frequently Asked Questions (FAQs)
How do I find my routing number?
The routing number is found at the bottom of the cheque. The first three numbers are the cheque number, the next five numbers make up the transit number and the final three are the institution number. Combine the transit and institution numbers to get your routing number.
If you don’t have cheques, you can call your bank branch or check your online banking portal to get the number.
How do I find my bank’s institution number?
The easiest way is to look up your bank’s institution number online. Most banks will have it listed on their websites and in their mobile banking app.
What are routing numbers used for?
Routing numbers are an integral part of transferring money. They’re used for:
- Setting up direct deposit with clients and employer
- Making or receiving electronic transfers
- You want to set up a digital wallet
- Making online bill payments
- Transferring money from your financial institutions to fintech apps
