Anyone who has ever sent money internationally has probably come across the term SWIFT, but what is this code? The SWIFT code, also called BIC, is a code created to make international money transactions more secure. Knowing how to use it, therefore, is essential to ensure that your money transfer is successful.
With that in mind, below we explain what the SWIFT code is, how it is formed and why it is so important in international transactions.
What is and how does a SWIFT Code work?
The SWIFT code is a unique universal code that can be 8 to 11 characters long, used to enable transfers between accounts based in different countries. SWIFT stands for Society for Worldwide Interbank Financial Telecommunication. Through this code it is possible to connect financial institutions around the world to allow them to send and receive money.
The SWIFT code, as said before, can consist of 8 or 11 digits. This happens because the last 3 digits are optional. In this way, the Swift code looks like this:
- The first 4 digits of the code represent the bank code, thus serving to identify it.
- The fifth and sixth digits of the Swift code serve to identify the country of the bank, e.g., Spain, code ES.
- The seventh and eighth numbers represent the city of the bank, and usually the initial letters of the city are used for this identification. For example, Barcelona, BB and Madrid, MM.
- Finally, the last three digits that, as we said before, are optional. When they appear, they serve to identify a particular bank branch of the bank. When the last three numbers do not appear in the SWIFT code it means that the sending is related to the main bank of the chosen banking network.
Why is the SWIFT code important?
The SWIFT code allows the accounts of financial institutions around the world to connect to the same system and the transfer of values to take place. In addition to the SWIFT code, you may need the IBAN, which identifies the customer account that will receive the international transfers.
While the SWIFT code is used to identify the world’s banking institutions within the system for international transfers, the IBAN number is used to identify a specific bank account within the international system.
You can search for the SWIFT code of a bank branch directly on the SWIFT website at this link.
Intermediaries can help with international transactions
In case you need to make an international banking transaction you can use intermediaries that help you with the transaction, like Western Union Canada.
Western Union Canada’s app can make your international money transfer quite easy and simple. Our app lets you simulate your transaction online before you complete it. This helps, especially, to understand the exchange rate1 for your transfer.
Check out how money transfers with Western Union Canada’s app works and start sending money abroad now!
1 Western Union also makes money from currency exchange. When choosing a money transmitter, carefully compare both transfer fees and exchange rates. Fees, foreign exchange rates and taxes may vary by brand, channel, and location based on a number of factors. Fees and rates subject to change without notice.