A sort code is a six-digit numerical code that identifies the specific bank and branch where a bank account was initially opened. It is used in the UK banking system to indicate where payment is going or coming from. Sort codes are the domestic bank codes used to route money transfers between financial institutions in the United Kingdom and in the Republic of Ireland. They are usually formatted as three pairs of numbers, for example, 12-34-56, and are encoded into IBANs but not into BICs. Sort codes are issued to any organization that will be a direct member of a UK electronic payment network, including BACS, Faster Payments, and CHAPS.

Sort codes are important because they allow financial institutions to confirm the validity of a transfer and correctly route money to the beneficiary’s accounts. Without a sort code, payment can be delayed, rejected, or even misdelivered, causing inconvenience and possible fees for both the sender and the recipient, especially for international transfers that may involve currency conversion and additional charges.

To summarize, a sort code is a six-digit code that identifies a specific bank and bank branch in the United Kingdom. It is required when making domestic or international transfers and is used to ensure that the money is correctly routed to the recipients account.