What is a SWIFT code?
A SWIFT code is a term that defines a universally recognized code used by a financial institution. The code labels a certain financial institution worldwide. It includes from 8 to 11 digits:
- first 4 digits will define a code of the bank or financial institution,
- 2 digits to define a country,
- other 2 for the place of residence or location code,
- and the last 3 (in case of 11-digit SWIFT) will indicate a branch code.
SWIFT Standards register the code.
This code is essentially important if the client wants to transmit funds to another country. BIC is another definition of the code. BIC (or Business Identifier Code) is an ISO 9362 standard.
The cipher is a combination of different letters that helps to recognize the bank. It enables the transactions on the global level. Additionally, it is also mandatory for banks because with the help of the code they can send other messages.
A SWIFT number is an approved format for BIC and is used to transmit funds between international financial institutions. Frequently, institutions apply them for global wire transfers to recognize all required data. Financial institutions use the cipher to operate the transfers of the funds accurately as well as to avoid complications that have a link to the money.