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What is a SWIFT Code? A Complete Guide

Updated on July 08, 2025 11:49 pm
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Sending money abroad might seem puzzling for some, but it is undoubtedly secure. One key component that makes international money transfers so secure is the SWIFT network, which is used for most cross-border transactions.

If you are wondering what a SWIFT code or bank identification code is, how it works, and why it is so important, you have landed in the right place. In this guide, we will tell you everything that you need to know about SWIFT codes and how they ensure your international transfers are secure and reliable.

What Is the SWIFT System?

SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication. It is a global messaging system used by banks and other financial institutions to exchange information smoothly, accurately, and securely.

The system doesn’t perform the transfer itself—it simply passes along the instructions for fund transfers between banks and, in some cases, through intermediary institutions as well.

What Is a SWIFT Code?

A SWIFT code, famously called Bank Identification Code (BIC), is a unique identifier assigned to banks and financial institutions globally. It is used to send and receive funds internationally and to securely communicate between banks.

Each SWIFT code is typically 8 to 11 characters long and contains information about the bank, its country, city, and branch. It is an alphanumeric code.

For example, the SWIFT code for Wells Fargo in the US is WFBIUS6WFFX. The first four letters represent the bank, followed by the country code. The next two characters are the city code, and the final four are the branch code.

Why Are SWIFT Codes Important?

Think of SWIFT codes as your bank's international address. Just like you need a street address to send or receive a letter, your bank also needs a SWIFT code to transfer money internationally.

The SWIFT code ensures that every time you send money internationally, it reaches the right place. Whether you are sending money back home to your loved ones or paying a business overseas, using the right SWIFT code keeps your transfer secure and smooth.

How Do SWIFT Codes Work?

When you initiate an international fund transfer, your bank sends a SWIFT message to the recipient's bank with the details, such as your bank account number and the amount of money you are transferring. The recipient's bank then verifies the information before processing the transfer. This process ensures your money is transferred to the right account, irrespective of where it is going.

Despite the rise of real-time payments, transfers using the SWIFT system can take five days or even longer because it involves account verification. Your bank may also charge a small fee for a SWIFT payment, subject to wire transfer costs.

How to Find Your Bank's SWIFT Code

Finding your bank's SWIFT code is just as simple as making SWIFT transfers. There are multiple ways to find it:

  • Visit your bank's official website.
  • Check your bank account statement, also known as a passbook.
  • Contact your bank's customer service.
  • Use an online SWIFT code checker tool.

It's important to have a SWIFT code and ensure that you have the right one each time you make an international transfer. Providing the wrong SWIFT code to the bank could result in your money being sent to the wrong bank account.

How to Avoid Common SWIFT Transfer Mistakes?

Even minor errors in international money transfers can result in delays or lost funds. Here’s how to avoid common pitfalls when dealing with a SWIFT code:

  • Always double-check the recipient's SWIFT code and bank details before initiating the transaction.
  • Don't confuse the SWIFT code with an IBAN—they serve different purposes depending on the country and type of transaction.
  • Ensure you provide complete information about the recipient or intermediary banks to avoid delay or failure in the transaction. 
  • It's a good practice to verify all requirements with the recipient's bank ahead of time so that you don't miss any essential information or steps.

Common Issues and How to Resolve Them in SWIFT Transactions

While SWIFT is a secure and reliable system, international money transfers don’t always go as planned. Here are some common challenges and ways to resolve them efficiently:

  • SWIFT transfers may experience delays, incur unexpected fees, or even get rejected. Delays are often caused by intermediary banks or bank holidays. To track a transaction, you can request an MT103 from your bank. An MT103 is a standardized SWIFT message used to send money internationally—it acts as proof of payment.
  • Transfer fees may vary depending on who is paying—the sender, the recipient, or both—so it is crucial to clarify the fees upfront before confirming a transaction. Additionally, exchange rates may also differ from the market rates, so compare them beforehand.
  • If your transfer fails, your funds are usually returned to you minus the transfer fee. It is important to use a reliable remittance service provider and keep a record of your transactions so that you don't have to worry later.

What If My Bank Doesn't Have a SWIFT Code?

Not all financial institutions are part of the SWIFT network. If your bank does not have a SWIFT code, it may use an intermediary bank to process the transfer.

In such cases, you might be charged an extra fee and experience a longer processing time. Always double-check this before finalizing your transfer.

SWIFT Code vs IBAN

IBAN stands for International Bank Account Number. While SWIFT codes and IBANs are the same, for transferring money internationally, they serve different purposes.

A SWIFT code helps identify a specific bank branch, whereas an IBAN helps identify a particular account within that bank. When transferring money to certain countries, you might need both the SWIFT code and the IBAN.

Reasons to Use a SWIFT Code for International Transfers

There are three main reasons why SWIFT codes are essential for international transfers:

  • Security: Each SWIFT code is unique, ensuring every transaction is secure and encrypted.
  • Global reach: SWIFT connects more than 11,000 banks and financial institutions globally, making it easy to transfer money anywhere in the world.
  • Speed: While SWIFT transfer may take some time, it is still faster than many other money transfer methods.

Wrapping Up

Navigating international fund transfers is simple and straightforward when you understand what a bank identification code or SWIFT number is and how it works. Using the correct SWIFT code—and IBAN where applicable—helps ensure your money reaches the correct account, smoothly and securely.

Are you ready to make your next international fund transfer smooth and secure? Visit CompareRemit today to find the best exchange rates with the lowest transfer fees to send money to your loved ones anywhere in the world. Stop second-guessing and start comparing!

Frequently Asked Questions (FAQs)

Q: Who pays SWIFT charges?

SWIFT charges can be paid by the sender, the recipient, or split between them, depending on the agreed-upon terms of the transaction. The codes used within the SWIFT messaging control this. So, the sender can choose to pay all fees, the receiver can pay all fees, or they can share the fees.

Q: Is SWIFT proof of payment?

A SWIFT code identifies the receiving bank, but it is the MT103 SWIFT message, generated during the transfer, that serves as the actual proof of payment. This document outlines key transaction details, confirming the transfer has been initiated and processed.

Q: What is the SWIFT payment fee?

SWIFT payment fees are variable. They consist of charges from the sending bank, potential intermediary banks, and the receiving bank, with additional costs possible for currency conversion. These fees fluctuate based on the transfer amount, destination, and the banks involved.

Q: Is SWIFT code the same for all branches?

No, SWIFT codes aren’t always the same across all branches of a bank. Some banks use one universal code, while others assign unique codes to each branch. If in doubt, it’s usually safe to use the SWIFT code of the bank’s main office.

Q: Can banks transfer money without a SWIFT code?

Generally, SWIFT codes are required for international bank transfers. Most banks are part of the SWIFT network, and their codes can be found on official bank websites, statements, or through customer service. Because SWIFT is the global standard for messaging systems, most cross-border transfers rely on it for security and accuracy.

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