What Is a BIC Code?
BIC is short for Business Identifier CodeBusiness Identifier Codes are primarily used for the identification of financial and non-financial institutions involved in day-to-day business transactions.
What Is a SWIFT Code?
SWIFT stands for the Society for Worldwide Interbank Financial Telecommunications. It is an international banking network that allows you to send transfers between intermediary banks around the world.
Is BIC the Same as SWIFT?
BIC and SWIFT are essentially the same because they both adhere to ISO 9362, which is the international standard for Business Identifier Codes.
What Are SWIFT/BIC Codes Used For?
Individuals and businesses seeking to send money overseas will need to use the BIC/SWIFT system because they are the international standard. That means it is the system used by global banks and financial institutions to communicate with each other in a timely fashion.
The BIC/SWIFT provides the information to know where the money should come from, and which account it should be credited to. Banks in your own country will be familiar with the process for sending money to domestic banks and will do this regularly. However, when moving overseas and including an ever-growing list of banks, they need a reliable system to avoid confusion.
What Does A BIC/SWIFT Look Like?
SWIFT/BIC codes are made up of 8-11 characters that identify your city, country, bank, and particular branch. The code will look like this:
AAAABBCCXXX
What Do the Numbers in a BIC/SWIFT Code Stand For?
– AAAA: A 4-letter bank code that is usually a shortened version of a bank’s name.
– BB: A 2-letter country code for the bank.
– CC: A 2-character location code for the bank’s head office in that country.
– XXX: A 3-digit branch code designating a particular branch. These last 3 digits are optional.
Here are three examples of well-known banks:
– Scotiabank: NOSCCATTXXX
– Charles Schwab Bank: CSCHUS6SXXX
– Bank of England: BKENGB2LXXX
How Does BIC/SWIFT Work?
BIC/SWIFT is an identifier system that is an international standard for routing transactions across borders. BIC/SWIFT provides the foundation for transfers to overseas accounts, but also provide a tracing mechanism should there be a problem with the transaction.
How Do I Identify My BIC/SWIFT Code?
There are three common ways to use for finding your BIC/SWIFT code:
– Look at your account numbers on a bank statement.
– You can also find them in your online banking portal, again by looking at a statement.
– Alternatively, you can go to your local branch or communicate with them to ask for the numbers.
Larger financial institutions will have an international payments department that can walk you through a payment if required.
Are There Fees Associated With Using a BIC/SWIFT Code?
There are no fees involved in order to use a BIC/SWIFT code, but your bank will charge you fees for making international transfers. These fees are also usually charged by both the sending and the receiving bank and can range from anywhere between $10 – $50 and upwards. When making an international transfer you will be asked which fees you will be paying and whether the recipient is accepting fees on their end.
How Payset Can Help
Another code that originated from the international standards was the International Business Account Number (IBAN). This was originally adopted by the European Committee for Banking Standards (ECBS) but is now adopted in 79 countries. The IBAN consists of up to 34 alphanumeric characters and includes additional routing information that was not standard in BIC/SWIFT and sometimes led to errors or confusion. The IBAN system is mandatory for Scandinavian countries and also in the likes of Saudi Arabia and the United Arab Emirates. It is also mandatory for some African, Caribbean and South American nations.
Payset is an online payments provider and one of the foundations of their service is a Virtual IBAN Account. Payset provides a range of payment systems, such as SWIFT, ACH, and CHAPS, but the IBAN can open the door to simple transactions with a long list of countries. Alongside being a more reliable format for international transactions, here is a list of benefits associated with a Payset Virtual IBAN Account:
Multi-Currency Support
With the Payset IBAN account, you can take advantage of a multi-currency platform. You can convert between 38 different foreign currencies and also hold up to 34 currencies at one time. Being an online-focused payments providers, you can send funds around the world rapidly at a fraction of the cost of high-street banks. Setting up an account at one of those banks for a foreign currency is also laborious and will still come with high fees.
IBAN Alternatives
Although IBAN is the preferred transfer network for your account, Payset also supports transfers through other payment networks including BIC/SWIFT, SEPA, and CHAPS. Depending on the nature of your business and your trading partners, it is likely that you will do the majority of your transfers through IBAN with the occasional need for one of the alternatives.
Free Payset Transfers
Transferring money from one Payset account to another is free and is another way to remove the high costs of legacy international transfer providers.
