In computing and electronic systems, binary-coded decimal (BCD) is a digital encoding method for numbers using decimal notation, with each decimal digit represented by its own binary sequence. In BCD, a numeral is usually represented by four bits which, in general, represent the decimal range 0 through 9. Other bit patterns are sometimes used for a sign or for other indications (e.g., error or overflow). Uncompressed (or zoned) BCD consumes a byte for each represented numeral, whereas compressed (or packed) BCD typically carries two numerals in a single byte by taking advantage of the fact that four bits will represent the full numeral range.
BCD's main virtue is ease of conversion between machine- and human-readable formats, as well as a more precise machine-format representation of decimal quantities. As compared to typical binary formats, BCD's principal drawbacks are a small increase in the complexity of the circuits needed to implement basic mathematical operations and less efficient usage of storage facilities.
BCD was used in many early decimal computers. Although BCD is not as widely used as in the past, decimal fixed-point and floating-point formats are still important and continue to be used in financial, commercial, and industrial computing, where subtle conversion and rounding errors that are inherent to floating point binary representations cannot be tolerated.