SWIFT in Banking:
SWIFT stands for the “Society for Worldwide Inter-bank Financial Telecommunications“. It is a messaging network that the institutions uses to securely transmit information and instructions through a standardized system of codes.
SWIFT assigns each organization (Both FI and Non-FIs) a unique code that has either eight characters or 11 characters. The code is called interchangeably the Business(or Bank) Identifier Code-BIC, SWIFT code, SWIFT ID, or ISO 9362 code.
- SWIFT’s messaging services are used and trusted by more than 11,000+ financial institutions in more than 200+ countries and territories around the world. Along with playing a role in standardization, SWIFT enables secure, seamless and automated financial communication between users
- SWIFT offers a portfolio of innovative products and services that help our users get the most out of SWIFT messaging. Their solutions seek to address challenges faced by the SWIFT community, to reduce risks, eliminate costs and increase efficiencies
- Brokerage Institutes and Trading Houses
- Securities Dealers
- Asset Management Companies
- Clearing Houses
- Corporate Business Houses
- Treasury Market Participants and Service Providers
- Foreign Exchange and Money Brokers
- SWIFT does not facilitate funds transfer: rather, it sends payment orders, which must be settled by correspondent accounts that the institutions have with each other. Each financial institution, to exchange banking transactions, must have a banking relationship by either being a bank or affiliating itself with one (or more) so as to enjoy those particular business features