What you Need to Know about SWIFT Codes
- 06 Oct 2022
Most of us have heard of SWIFT codes before, but they aren’t understood by all businesses until they start to trade internationally which is when payments can become a little more complicated. You may have seen it on other invoices before, or read about it and aren’t quite sure what’s behind them. Here we discuss what they are, why they are used and some of their main benefits.
What is SWIFT?
Swift is short for Society of Worldwide Interbank Financial Telecommunication. The concept behind it was to make cross-border payments for businesses that operate globally a smooth and clean process. It makes international commerce completely safe and secure and is used by companies all over the world.
What is a SWIFT code?
This is a Business Identification Code (BIC) that is given to banks by SWIFT so they can identify the bank (sort of like a sort code). It’s made up of 3 parts which are the institution, the country they are based, and localised location. Not every bank has a SWIFT code, but all banks have the option to have one. If a bank doesn’t want to allow cross-country payments then there would be no need for it. You can look for banks that have this infrastructure by using a SWIFT code checker.
Why is it Important for your Business?
If you are a business that would like to operate globally, then ensuring you are working with an institution that has a SWIFT code is of increasing importance. It makes international payments so easy to track, which can be difficult without this infrastructure.
This is why using a swift code checker should be a necessary part of your business’s practice. Searching a trusted database to find exactly the code you need – all you must have is the country and bank name to do so – quickly so money can be transferred without holdups is essential to a business aiming for efficiency and growth.
If you don’t use a bank with a SWIFT code, not only is it more time consuming but it could also cost you more financially depending on the alternative you choose. Typically there are costs associated with international payments that you would then need to worry about.
It also ensures that you can transfer safely and securely which is possibly the most important part. This means that you can be safe in the knowledge that when you are making or receiving payments that you don’t need to worry about any fraudulent activity. You can also connect the likes of PayPal and Wise which makes things much easier.
The other thing is, it’s really easy for businesses to utilise no matter how big or small they are. If you have an accounts department, multiple people can use this method of transaction. All they need to know is the password to make it happen. Of course, you’d need to make sure that your password is kept safe and secure.
If you are a business that has been operating internationally for some time and looking to make your transactions more seamless, or you are now operating on a global scale - then it’s definitely a good idea to look into how SWIFT could benefit you.