You may find BIC and SWIFT bank codes to be a little confusing at first glance, but it is essential that you understand them if you need to send international payments. If your business has a global presence, for instance, then you are going to need to know everything there is to know about them.
We are going to walk you through the finer details of BIC codes and SWIFT codes, such as what they are, what they look like, how to use them, and how to find them.
Once you have finished reading through this article, you’ll become aware of everything you need to know about what are BIC and SWIFT bank codes and how they work.
What is a BIC code?
The first thing to know here is what BIC stands for: Bank Identification Code, or Bank Identifier Code as it is sometimes referred to. The code itself contains 11 characters that are used to identify the bank whenever you are making an international transaction. In this sense, it is kind of like a postcode for your bank, which ensures that your money travels to the correct location.
What is a SWIFT code?
Now you know what a BIC code is, it is time to move on to SWIFT codes. Firstly, it stands for the Society for Worldwide Interbank Financial Telecommunication. This is a global network that processes payments between countries. Other than that, there is no real difference between the two codes.
What is the difference between SWIFT codes and BIC codes?
As we have just mentioned, there are no big differences between SWIFT codes and BIC codes. The terms included are the same, but they operate under different names. Therefore, you may occasionally see these codes listed as BIC/SWIFT, because they are pretty much the same thing.
What do BIC/SWIFT codes look like?
The best way to identify these codes is to know what you are looking for. Every BIC and SWIFT code operate under the same format; each are between 8 and 11 characters long arranged in a certain way.
The codes are arranged as follows:
AAAABBCCDD
To break this arrangement down and ensure it is easy for you to understand, we shall now dissect each individual part of the code.
AAAA – This is the four-letter bank code that will appear as a shortened version of the bank’s full name.
BB – These two characters represent the country the bank is located in.
CC – This will represent where the bank’s head office is located within the previously stated country.
DDD – These three characters state the branch code, informing you where the specific branch is located. This section is optional, which is why the codes can either be 8 or 11 characters long. In instances where the branch code is left out, the characters shall be replaced by a triple X, or left as blank.
Where can I find my BIC code?
When receiving an international payment, you will need to know you BIC number. The best place to seek it out is on your bank statements. If you no longer receive physical bank statements, log into your online banking services, and bring the documentation up on your phone or laptop/computer. If this doesn’t work for you, give your local bank branch a call and find your information from there.
If you are making an international payment, things work a little differently. You may need to find the SWIFT number of the recipient. This is relatively easy to do as you can use BIC/SWIFT finders online. There are many online tools available today that allow you to search for the codes of branches or validate codes for added security.
Lastly, before authorising any payments, you need to confirm that your recipient’s BIC code is correct. If you use an incorrect code, problems can occur, such as payment being sent back the other way, delays appearing in the process, or money being sent to the wrong account.
Do you have to pay to use BIC/SWIFT codes?
The short answer here is, yes. The vast majority of banks will charge a fee for the processing of international payments. You will likely be charged between £40-£50 when using a BIC number for your payment. You should be aware that other fees can also arise throughout the international payment process. These include handling fees from corresponding banks. These fees can quickly climb up and multiply because SWIFT numbers regularly travel through 1-3 banks.
You should check the small print at every given opportunity because details on extra fees are often hidden within it. Without first reading these segments you may not be able to discover how much you’ll eventually be charges for the transfer.
How do BIC/SWIFT codes work?
Banks often rely on other corresponding banks when they send international payments. These banks each work together throughout the process as money is moved from one place to another on its journey to the recipient.
SWIFT codes ensure that your payments arrive at the right place and at the right time. When you have the recipient’s BIC number you can contact your bank and request the international payment is made. You can either do this in your local branch or by utilising online banking.
What is the main difference between IBAN and BIC/SWIFT?
IBAN numbers allow you to identify an individual bank account, whereas BIC or SWIFT codes help you in identifying the bank itself. IBAN is used by banks across Europe and ensures that payments reach their destination without complications.
You should now understand everything you need to on the topic of BIC and SWIFT bank codes. If you require further information on any areas, don’t hesitate to contact a member of our expert team today. We can also offer you help with financial issues that may be plaguing your venture at the moment, and turn your luck around.
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Seasoned professional with a strong passion for the world of business finance. With over twenty years of dedicated experience in the field, my journey into the world of business finance began with a relentless curiosity for understanding the intricate workings of financial systems.