What are BIC and SWIFT codes?
A SWIFT code is an 8 or 11 character code which is used to identify a specific bank when making an international money transfer via the SWIFT network. You can find your bank's SWIFT code on your statements, your bank's mobile app or website. If you're having trouble locating your SWIFT code, you can go into your bank branch and request it. You may also see SWIFT codes referred to as a “SWIFT ID” or “BIC codes” — people use the terms interchangeably.
If you’ve ever paid a global supplier via bank transfer or received a payment from an international business, you’re probably familiar with SWIFT codes. In this article, we’ll explain exactly what SWIFT is and clear up any confusion concerning SWIFT codes, BICs (Bank Identifier Codes), and IBANs (International Bank Account Numbers). We’ll also lay out some SWIFT alternatives that provide a faster and cheaper way to send and receive money globally
What is SWIFT?
SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication. It is essentially a messaging system that banks and financial institutions use to receive information from around the world.
SWIFT doesn't actually transfer or hold money, it's a messaging network that sends instructions on how to do so. SWIFT provides a secure, encrypted way for banks to send and receive financial data when processing international money transfers.
As of 2021, more than 11,000 member banks and institutions worldwide sent an average of 42 million messages per day through the system. “Vast” is an understatement when it comes to the SWIFT network.
When a financial institution becomes a SWIFT member, the system assigns them a unique code. This is so the SWIFT system can identify the sending and receiving bank when businesses and individuals make global money transfers.
What is a SWIFT code?
SWIFT codes are made up of four parts:
branch code (optional)
Where can I find my SWIFT code?
You can find your SWIFT code on your bank account statements. You should also be able to find it on your bank’s website or mobile app. Look for a code that is 8 or 11 characters long.
Is a BIC the same as a SWIFT code?
Yes. SWIFT codes and BICs are the same thing, and the terms are used interchangeably. BIC stands for “Business Identifier Code”.
What is an IBAN?
IBAN stands for International Bank Account Number. Each bank account has a unique IBAN which can be up to 34 characters long. People sometimes get IBAN and SWIFT codes confused, but the difference between the two is simple. IBANs are used to identify individual bank accounts, SWIFT codes are used to identify a bank.
It’s important to note that your IBAN number differs from your bank account number and your sort code. A sort code is a domestic bank code that systems use to route money among financial institutions. Your IBAN is used for international transactions.
What are the alternatives to SWIFT?
The SWIFT system is 50 years old, and it shows. The SWIFT network operates through banks passing messages between one another. This process can take days, and each bank may charge a handling fee.
The lack of transparency around SWIFT means there’s no way for businesses to know how long their payments are going to take to clear or how much they will cost. This is not an ideal situation for businesses that need to pay their suppliers and employees on time.
Airwallex offers an alternative to SWIFT. With Airwallex, businesses can make fast (usually same-day) money transfers across the globe with zero transaction fees. It’s an easy and cost-effective way to pay global suppliers and staff, and accept global payments.
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Tilly manages the content strategy for Airwallex. She specialises in content that supports businesses in their growth trajectory.
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