Finance leaders are empowering their teams with generative AI. Learn how in our new tech talk.Watch Now →



Welcome to Learn, where we provide straightforward, easy-to-understand definitions of the payments industry.

Follow us

A SWIFT code, also known as a SWIFT ID or Bank Identifier Code (BIC), is the unique 8-11 character code assigned to a bank in order to facilitate accurate, efficient international wire transfers through the SWIFT network.

SWIFT, or the Society for Worldwide Interbank Financial Telecommunication is the network of 11,000 member financial institutions that enables fast, secure international wire transfers. To standardize messaging for each wire transfer and ensure funds are accurately delivered to the correct receiving bank, the network assigns a unique code to each bank that corresponds to the institution, country, location, and branch. Think of it as a financial Rolodex that over 11,000 banks share, making it easy to see who sent money to whom.

How do SWIFT codes work?

Let’s take a look at a SWIFT code up close to understand how its interlocking parts work together.

Say you’re trying to send funds to a business partner in Tokyo, such as the business banks at Bank of Tokyo-Mitsubishi UFG in Tokyo. The SWIFT code for the bank is BOTKJPJTXXX.

The first four characters correspond to the institution: BOTK is Bank of Tokyo. The next four characters indicate the country and city: JP is Japan, and JT is Tokyo. The last three characters indicate the branch.

It’s important to make sure that you have the correct SWIFT code for each wire transfer to ensure the payment reaches its intended destination.

History of SWIFT

SWIFT was formed in 1973 to help standardize international funds transfers and prevent security risks that traditional telegraphic transfers posed. Its inaugural year, it was initially supported by 239 banks in 15 countries. By the time the first message was sent in 1977, that had expanded to 518 banks in 22 countries.

More from


Learn topic image

Learn how money moves throughout different countries around the world.

A Canadian EFT (or Electronic Funds Transfer) is a bank-to-bank transfer in Canada, similar to ACH in the US.

Read more

Part of the FedACH system, FedGlobal ACH offers low-cost and efficient cross-border ACH payments.

Read more

A SWIFT code, also known as a SWIFT ID or Bank Identifier Code (BIC), is a unique 8-11 character code assigned to a bank for SWIFT wire transfers.

Read more

US companies moving money internationally will likely weigh the pros and cons of SWIFT vs. Global ACH when it comes to attributes like speed and cost.

Read more

Payment rails are the underlying systems and networks that facilitate the movement of funds between parties in financial transactions.

Read more

Pix is Brazil’s instant payment platform that launched on November 16, 2020. Created and managed by the Central Bank of Brazil, Pix enables fast payments and transfers at any time, year-round.

Read more

SWIFT payments or international wires are global payments made through the Society for Worldwide Interbank Financial Telecommunication (SWIFT) network.

Read more

Global ACH can help companies move money from US-domiciled accounts across borders using local rails. Learn how and when to use this payment rail.

Read more

The Office of Foreign Assets Control (OFAC) is a financial intelligence and enforcement agency under the jurisdiction of the US Treasury Department.

Read more

Real-Time Gross Settlement (RTGS) is a system for electronic payments between two banks, where the transactions process and settle in real time rather than being batched.

Read more

TARGET Instant Payment Settlement (TIPS) was launched by the Eurosystem in November 2018 as a market infrastructure service that settles instant payments.

Read more

An International ACH Transfer—also known as Global ACH—is an ACH payment made cross-border from a US-domiciled account.

Read more

Originally known as Bankers’ Automated Clearing System (BACS), BACS Payment Schemes Limited clears and settles direct debit, BACS direct credit, and current account switch service in the United Kingdom.

Read more

The Bulk Electronic Clearing System (BECS) is a streamlined electronic payment method used to process low-value, bulk transactions in Australia and New Zealand.

Read more

The Faster Payments Service (FPS) is a banking service in the United Kingdom. The FPS was instituted in order to reduce payment times between accounts held by different customers.

Read more

The Single Euro Payments Area (SEPA) is a system of payment schemas that standardizes cashless transactions in euros.

Read more

Unified Payments Interface (UPI) is a real-time payments system for mobile applications designed and launched by the National Payments Corporation of India.

Read more

Subscribe to Journal updates

Discover product features and get primers on the payments industry.




Modern Treasury For

Case Studies





Popular Integrations

© Modern Treasury Corp.