Swift Code or the Society for Worldwide Interbank Financial Telecommunication code is a globally accepted identification system for banks. These codes are mostly used for carrying out international wire transfers and can have 8/11 alphanumeric characters. It was first authorized to be created by the International Organization of Standardization (IOS).
The code is used worldwide not only for carrying out wire transfers, but also for identifying banks. It is also referred by a few other names including the BIC code, SWIFT ID, and the SWIFT-BIC. It is essential for sending money beyond borders. If you need to send money overseas, you will need to have the SWIFT code of the recipient's bank to be able to make the transfer.
The core of the system is to provide a central storage and forward system. It also has some transaction management control. If you have to send money between different banks with authorization/copy with an institution, it will format the message based on the industry standard and then make the transfer in a secure way. SWIFT will ensure safe and secure transfer to the recipient bank after appropriate action is taken by the institution in the middle. The 'guarantee' of transfer is created by high level of redundancy of software, hardware and people. This is what makes this system so reliable and so widely accepted.
Most of the international interbank messages rely on the SWIFT network. It is used in almost all the countries worldwide. It is estimated that tens of millions of messages are exchanged every day. A unique thing about this system is that it will only transfer financial messages in a highly reliable and secure way without holding any accounts for members. It will also not form any kind of clearing/settlement.
There is widespread misconception that SWIFT facilitates our funds transfers. The truth is that it will only send payment orders. These orders are then settled by the correspondent accounts which the financial institutions hold with each other. Every institution will have a banking relationship to be able to carry out the banking transactions.
As an organization, SWIFT exists as a cooperative organization that is headquartered in Belgium. It is owned and operated by a large number of member financial institutions that have offices worldwide. The organization also has a CEO and Chairman. It hosts annual conference known as SIBOS that is targeted at the financial services industry.
Today, the SWIFT standard has become a well accepted and recognized industry standard of proper syntax for carrying out financial messages. The SWIFT standard messages are formatted to be read and processed by all the commonly used financial processing systems. These systems don't have to be able to transfer on the SWIFT network. It also has cooperation with global organizations for the definition of standards for message formats and contents. It's also a registration authority for many ISO standards. There is no other system that is so widely used and accepted as it.
The IFSC Code or the Indian Financial System Code is an 11 character code that is used by the Reserve Bank of India for identifying all the bank branches which are part of the NEFT system in India. It is used for the electronic payment system applications like the NEFT (National Electronic Fund Transfer, RTGS and CFMS.Read More
MICR Code or Magnetic Ink Character Recognition is a character recognition system used mostly by the banking industry for facilitating the processing of cheques. These characters are printed in special unique typefaces with magnetic ink. Iron oxide is the commonly used material and it requires a specially designed machine for reading these characters. These characters are mostly printed on the bottom of the cheque leaf. The code is required by the Reserve Bank of India (RBI) for identifying the bank and branch and clearing the cheque.Read More
When it comes to making an international online payment, you will be required to provide a BIC code. It can often leave one confused as to what the Bic Codes refer to. These are the same as SWIFT codes. It is an international banking code for transfer of financial messages. The code is also used for identifying banks all across the world. BIC stands for Bank Identifier Code and SWIFT refers to the Society for Worldwide Interbank Financial Telecommunication.Read More
The BSB Codes or Bank State Branch codes are 6-digit codes used for identifying banks and branches in Australia. If you want to transfer payments within Australia, you will need the account number and the BSB code of the recipient. Similarly, you will have to provide your own account number and BSB to the sender. As already mentioned, there are 6 digits in this code. The first 2 or 3 digits are used as bank identifier. This part of the code is used to process both electronic and paper-based transactions. However, it is not used in the case of payment card numbering.Read More
Sort Codes are numbers assigned to bank branches and they are used mostly for the internal purposes of the bank. These codes will have 6 digits which are separated in sets of two's with hyphens. They are most widely used in the banking systems of the United Kingdom and Ireland.Read More