Sometimes referred to as a check routing number [URL="
https://dev.to/routingnumber/how-to-recognize-fractional-routing-numbers--meb"]ABA transit numbers[/URL were developed by the American Bankers Association in 1910 to indicate check processing endpoints. Since then, the numbers' use has expanded to include participants in check clearing between banking institutions, automated clearinghouses, and online banking activities.
The numbers are also used in Fedwire transfers, and each digit making up the ABA routing number plays a role in the process.
In the past, the first four digits represented the bank’s physical location issued by the Federal Reserve Routing System.
2
In 2019, due to the frequency of mergers and acquisitions of banks, these numbers may not represent a physical location.
The next two digits represent the Federal Reserve bank that is being used to route the electronic transaction. The seventh digit in the number identifies the assigned Federal Reserve check processing center for the bank, and the eighth represents the Federal Reserve district the bank resides in.
The last digit represents a complex mathematical equation that uses the first eight digits. The checksum is a safety measure. If the first eight digits do not equal the final digit, the transfer is marked as questionable and rerouted for manual processing, a far lengthier process.
