Business Definition for: ABA transit number
ABA transit number
numeric coding facilitating check clearing among banks. The ABA numbering system, managed by the American Bankers Association, assigns a unique identifier to each U.S. financial institution. The ABA number is printed as the numerator (upper portion) of a fraction appearing in the upper right corner on checks; the denominator is the bank's
check routing symbol
, which identifies the Federal Reserve Bank servicing that financial institution.
See also
Magnetic Ink Character Recognition (MICR)
Related Terms:
digital characters on the bottom edge of a paper check containing the issuing bank's ABA transit number (bank identifier) and check routing symbol (denoting funds availability). When checks are cleared through the banking system, the dollar amount of the check is added to the machine readable MICR line. Development of MICR in the 1950s greatly facilitated check clearing, enabling banks to virtually automate the handling of billions of checks every year.
Referring Terms:
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