SWIFT is like a messenger for banks to exchange details about where and how to send cash. Although it doesn’t actually hold onto your cash during swift transactions, it plays a vital role in making sure the right info gets to the right bank through special codes known as BICs.
In this article, we’re going to dive into how SWIFT keeps your money safe and the process you should go through to send money abroad. Plus, we’ll explain why it’s important to make sure everything’s running properly and securely.
Whether you’re someone who sends money internationally or is just interested in how it all works, getting to know SWIFT is key to enhancing your banking communication.
Understanding the SWIFT Banking System
The Society for Worldwide Interbank Financial Telecommunications, better known as SWIFT, has revolutionized banking communications globally.
It’s not a bank, but a secure messaging network used by financial institutions to transmit information and instructions. SWIFT has over 11,000 member institutions in more than 200 countries. Each member is assigned a unique BIC code, identifying the bank name, country, city, and branch.
Despite not holding or transferring assets itself, SWIFT facilitates international money and security transfers, making it the largest and most streamlined method for international payments.
Key Features of SWIFT Transactions
Several key features of SWIFT transactions make it your go-to choice for secure international banking communication.
SWIFT provides a secure network for financial institutions worldwide. It’s like a global postal service for banks, ensuring your messages are delivered safely.
Each member institution is assigned a uniqueBusiness Identifier Code (BIC). This distinct code ensures that your transactions are correctly routed to the intended recipient.
SWIFT doesn’t hold or transfer funds. Instead, it sends payment orders that must be settled by correspondent accounts.
