Why should you get an LEI number? 

get an LEI number

LEI, which stands for Legal Entity Identifier, is a 20-digit number or code that is used to identify or verify parties engaging in monetary transactions around the world while also increasing the precision and reliability of financial data for improved risk assessment following the global financial crisis. It is used to track all financial transactions taking place between different parties or entities around the world. Click here to know more. 


Its goal is to provide controlled identity for legal entities like firms and companies, operating in the financial sector. The goal is to make assets more public, as well as the data that goes with them, more integrated and accessible. As a result, any financial dangers associated with interacting with such companies around the world are reduced.

Who needs an LEI?

Any single individual operating in the banking system does not need to hold an LEI. Only non-individual entities like large corporations and firms are required to obtain LEI. There is a good chance you will need an LEI if you are engaging or taking part in the global financial system. Since the LEI’s inception, numerous laws have been enacted requiring specific firms to obtain an LEI code in a variety of regions and sectors, both directly by the government and internationally.

Importance of LEI

  1. LEI code or number is your worldwide identifier. It enables you to be recognized all around the world. The LEI code is vital because it links to your company’s identification record. The LEI is a necessary identification for inter-border commerce to be possible. The LEI improves your brand’s reputation both domestically and abroad.
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2.  The use of LEI is mandated by the government in many countries. Non-compliance halts transactions and exposes the company to penalties. Many restrictions require organisations to purchase LEIs. Every month, new rules requiring the use of LEIs come into effect.

3.  For Know Your Customer (KYC) procedures, the LEI code is frequently used to verify that your company is accepted as a legitimate LEI owner. In the banking industry, the use of LEIs as a cost-cutting strategy in KYC/onboarding has been thoroughly investigated. LEI is the main connector between all local, or non-governmental identifiers. 

4.  The LEI system’s data accuracy is clear and transparent. Within the ecosystem, there is a clear, publicly available method for openly challenging identification data if a counterpart believes it is incorrect. Your LEI code will be used by a variety of other programs. By acquiring an LEI, you may improve your privacy and brand safety. 


For years, there has been a worldwide need for an identifier like the LEI code. Since globalization grew exponentially in the 1900s, a need for financial accountability emerged, as a means of boosting trust in those with whom you are interacting, particularly across borders. There was no universal identification that could be applied to all corporate entities in different sectors, such as businesses, funds, and government entities. It is for this reason that LEI codes are essential.



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