A Legal Entity Identifier, or LEI, is a globally recognised identifier used to uniquely identify legally registered organisations, funds and trusts. The LEI provides a standardised way to identify who is who in financial transactions, regulatory reporting, and an increasing range of cross-border business activities.
Introduced by the G20 to improve transparency and trust in global markets, the LEI connects organisations to verified reference data and helps regulators, financial institutions, and counterparties clearly identify the legal entities they are dealing with. Today, millions of LEIs are used worldwide across regulations in financial markets, payments, compliance, and digital identity initiatives.
What does LEI stand for and what is a Legal Entity Identifier?
LEI stands for Legal Entity Identifier. It is a 20-character ISO 17442 alphanumeric code issued to legally registered entities such as companies, funds, financial institutions, and public sector bodies.
An LEI does not identify individuals. Instead, it identifies organisations that participate in regulated or cross-border activities, providing a consistent and globally recognised identity regardless of country or jurisdiction.
Why was the LEI created?
The Global LEI System was created in response to the global financial crisis of 2008 to address a fundamental problem: regulators and market participants could not reliably identify which legal entities were involved in financial transactions. Before the LEI, different countries and markets used disparate identifiers, some local, some proprietary, leading to confusion when entities operated across borders.
By introducing a single global identifier, the LEI enables:
- Greater transparency in financial markets
- Improved risk monitoring and regulatory oversight
- Faster identification of counterparties
- Reduced operational and compliance risk
Today, the LEI is used in a broad range of use cases and is recognised as a foundational component of trusted organisation identity.
What does an LEI code represent?
An LEI is a 20-character code structured according to the ISO 17442 standard. Each LEI is linked to a reference record containing verified reference data about the legal entity, referred to as LE-RD, including:
- Official legal name
- Registered address
- Country of formation
- Registration authority and number
In addition, the LEI contains relationship data that can describe parent and subsidiary structures, helping to deliver transparency across complex corporate groups.
The LEI code is detailed in the ISO 17442 standard, and each LEI is a unique alphanumeric string: for example 529900T8BM49AURSDO55. The first four characters identify the issuing entity (the GLEIF LEI Issuer, such as RapidLEI), the next 14 are a unique entity identifier, and the final two form a checksum.
Who needs an LEI?
LEIs are required or strongly encouraged for a wide range of organisations, including:
- Companies and corporate groups
- Banks and financial institutions
- Investment funds and asset managers
- Subsidiaries and special purpose vehicles
- Certain public sector and government entities
Over 300 regulations require the use of the LEI. Whether an LEI is mandatory depends on regulation and jurisdiction, but LEIs are increasingly required for organisations engaged in regulated, financial, or cross-border activities or payments.
How are LEIs used in practice?
LEIs are used across a growing number of real-world scenarios:
LEIs in financial markets and reporting
LEIs are widely required for regulatory reporting under market regulations and transaction reporting regimes.
LEIs in payments and transaction monitoring
LEIs help improve transparency and fraud prevention in cross-border and high-value payments by identifying the organisations involved.
LEIs in AML, KYB and sanctions screening
LEIs provide a reliable organisational identifier that supports customer due diligence, KYB, sanctions screening, and ongoing monitoring.
LEIs in trade finance and supply chains
LEIs are increasingly used to identify trading partners, improve data quality, and reduce fraud in complex global supply chains.
LEIs and regulatory requirements
Regulators around the world reference or mandate LEIs to improve transparency and oversight. LEIs are used in over 300 global and local regulatory frameworks covering financial markets, payments, and anti-financial crime initiatives.
Examples of regulations and standards naming the use of Legal Entity Identifiers includes:
- US: The Commodity Futures Trading Commission (CFTC, part of the Dodd-Frank Act), SEC Securities Exchange Act, Paperwork Reduction Act, U.S. Customs and Border Protection (CBP)
- EU: Instant Payment Regulations (IPR), Digital Operations Resiliency Act (DORA), Crypto-asset filing requirements (MiCA), Markets in Financial Instruments Regulation (MiFIR), European Securities and Markets Authority (ESMA), European Market Infrastructure Regulation (EMIR)
- Asia: Reserve Bank of India initiatives, Securities and Exchange Board of India (SEBI), People’s Bank of China: Five-Year Plan for Financial Standardization, Financial Investment Services and Capital Markets Act (FSCMA) of Korea
- Standards: ISO20022 Open Global Standard for Financial Information (including Bank of England’s adoption of LEI in CHAPS), ISO 17422 Application in Digital Certificates for Trust Service Providers
While requirements vary by jurisdiction, LEIs are commonly required where accurate identification of legal entities is critical to managing risk and compliance.
Read more in the LEI Regulations spotlight section.
Is an LEI required globally?
The LEI system is global, but whether an LEI is mandatory depends on local regulation and activity type. In some regions and use cases, LEIs are required by law. In others, they may be non-mandated but expected as a best practice for cross-border business and compliance.
Organisations operating internationally often choose to obtain an LEI even where it is not strictly mandatory, to support smoother transactions and regulatory readiness across complex trade borders.
Who issues LEIs and how does the Gloabl LEI System work?
LEIs are issued within a global governance framework overseen by the GLEIF (Global Legal Entity Identifier Foundation). LEIs are issued by accredited organisations known as LEI Issuers or Legal Operating Units (LOU) which are responsible for validating entity data and maintaining data quality standards.
This governance model is unique, and this level of oversight and regulation ensures that LEI data is reliable, consistent, and globally trusted.
Each unique LEI Code is published in the Global LEI System (GLEIS) database. LEI Search services access the database to look up the LEI and link to identity reference data about the organisation on a global scale, across borders.
Read more: What is the GLEIF?
How long is an LEI valid and why must it be renewed?
An LEI is valid for one year from the date of issuance or last renewal. Annual renewal is required to ensure that the legal entity reference data remains accurate and up to date. Some LEI Issuers, like RapidLEI, offer multi-year LEI registration.
If an LEI is not renewed, it becomes lapsed and may no longer be accepted for regulatory reporting, payments, or financial transactions.
LEI pricing varies by LEI Issuer. You can find full details of costs used by RapidLEI on the LEI Price page.
LEI vs other organisation identifiers
LEIs complement, rather than replace, other organisation identifiers such as company registration numbers or tax identifiers. While national identifiers are issued locally and vary by country, the LEI provides a single, globally recognised identifier that works across borders and systems.
| Identifier | What it identifies | Issued by | Geographic scope | Typical use |
|---|---|---|---|---|
| LEI (Legal Entity Identifier) | Legal entities (companies, funds, institutions) | GLEIF accredited LEI issuers | Global | Regulatory reporting, payments, AML/KYB, cross-border transactions |
| Company registration number | Legal entity | National business registry | Country specific | Company incorporation and local legal identification |
| Tax ID (e.g. EIN, TIN) | Tax-paying entity | National tax authority | Country specific | Tax reporting and administration |
| DUNS number | Business entity | Private provider | Global (commercial) | Credit risk, supplier assessment |
| BIC / SWIFT code | Financial institution | SWIFT | Global | Identifying banks in payment messages |
For a detailed comparison of business identifiers and when each is used, see our in-depth guide: Comparing Organisation Identifiers
The future of the LEI and digital identity
The LEI has evolved beyond its original regulatory role and is increasingly recognised as a foundation for trusted organisational digital identity. At RapidLEI we consider the LEI to be the only regulated KYB verification available globally.
How to get an LEI
Obtaining an LEI involves submitting legal entity information to an accredited LEI Issuer like RapidLEI. It’s a fast and automated process with RapidLEI. For more information, learn how to get an LEI.
RapidLEI has been a GLEIF-accredited LEI Issuer since 2018 and operates globally.
Video: an introduction to Legal Entity Identifiers
Watch this short video to learn more about LEIs and see how RapidLEI can help your organisation register an LEI: