Today, the SWIFT payment system is one of the most reliable and fast ways to transfer funds at the international level. It consists of unified forms and methods of transferring banking data, protected from unauthorised access.
What is the SWIFT code?
The system generates a unique identifier code for each financial institution that has joined the SWIFT community. Using bank identifier codes speeds up and simplifies the processing of information in international bank transactions, guarantees the protection of money and ensures the accuracy of transfers between banks worldwide. The personal code does not contain information about the recipient. Therefore, when making a monetary transaction, you must specify its details.
Using the SWIFT code, you can make international payments for education, medical treatment or holidays abroad. It is also beneficial to transfer money to individuals outside the country. SWIFT supports all world currencies.
You can find a SWIFT code by contacting your bank or checking your paper bank statements or online banking app.
How does the SWIFT code look?
The bank's SWIFT number is a combination of 8 or 11 Latin letters, sometimes combined with numbers. The combination consists of four elements:
- the first four digits are the abbreviated name of the banking organisation, or bank identifier code;
- 5 and 6 — country abbreviation;
- 7 and 8 — location of the institution, or location code;
- 9-11 is a code for divisions or branches.
Unified codes of banking institutions are formed following the international structure of ISO standards.
Is the BIC code the same as the SWIFT code?
Business identifier code, or BIC code, is another name for the SWIFT code. At first, these cyphers were called fast numbers but were later referred to as the BIC code.
Both terms — SWIFT code and BIC code — are used today and mean the same thing. Therefore, when filling out the transfer form, you can indicate the BIC code in the SWIFT column.
Please find out more about the BIC code in our Glossary.
Is a SWIFT code the same as an IBAN?
Initially, the introduction of the IBAN was intended to unify accounts between banks in the EU countries, but now it is used in other countries. For banking organisations in some countries, using an IBAN code is mandatory when making transfers in national and foreign currencies (for the latter, the SWIFT code is also used).
Each country sets the length of the code independently, but the total number of characters cannot exceed 34. It should also contain encrypted information about the recipient's bank.
IBAN code structure looks like this:
- the first two characters are the country code;
- 3, 4 — check number, which protects from data entry errors;
- 5-34 — domestic bank account cypher.
The components of the IBAN and SWIFT codes have significant differences. It is impossible to determine the address of a bank account by the SWIFT number, and a financial transaction is carried out only between banks. The IBAN code identifies each account involved in the movement of money.
The key to successful transactions is the awareness of the financial institutions' clients about the features of each payment system. The funds will quickly reach the addressee with a proper choice of international money transfer and correct data entry.
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