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SWIFT Financial messages: authentic and universal

SWIFT Financial messages: authentic and universal

The SWIFT financial messages are trusted as the most authentic and universal financial messages world over. SWIFT financial message is also the most convenient and fastest medium through which banks can meet customer’s requirement to send and receive message to and from any countries.

Reasons for trusting SWIFT messages by banks and financial institutions:

SWIFT stands acronym for Society for Worldwide Inter-bank Financial Telecommunication. It is a co-operative society formed by the member banks, with its headquarters at La Hulpe, Belgium. The messages are authenticated communication channel between two parties on prior agreement. The messages largely financial are mailed through computer based medium.  The advantage in transfer of messages in SWIFT medium is that it does not require separate authentication like test cipher. The various types of messages are in a prescribed format which has to be properly filled up to transmit the message. The fields of SWIFT messages are so structured that the messages are authenticated and are universal. The SWIFT messages can be classified into nine categories. They are as under.

  1. Customer Transfer & Cheques
  2. Financial Institutions Transfer
  3. Confirmations (related to Treasury/Money Markets, foreign exchange & derivatives)
  4. Collection & Cash letters
  5. Securities
  6. Precious Metal & Syndication
  7. Documentary Credit & Guarantees.
  8. Travellers Cheques
  9. Cash Management & Customer Status

The message type 1 to 8 are authenticated messages. These messages are sent to the correspondents of the bank with whom they have Relationship Management Arrangement (RMA). Message type 9 is unauthenticated which is called free format, which can be sent to any correspondent even if there is no RMA.

Process of transmission of SWIFT messages:

Creation: Message can be created by the user who has been permitted to enter the messages.

Authorisation: Wherever messages are created for the purpose of payment, same has to be authorized by an authorized officer of the bank.

Verification: Only payment messages are to be verified by a authorized officer.

Once the messages are authenticated/ verified, the messages will go to SWIFT server immediately and they cannot modify or stop the messages later on.

Duplicated messages:  Messages related to payments or LC sent through SWIFT is comparable to parting money from bank’s NOSTRO account. It is very difficult to recover money paid through duplicated message, more so if it is MT 103 which is a payment message to individual’s account.

The payment messages are of two types. i. Payments to individuals. ii. Payments to Financial institutions.

MT 103 format is used for payments to individual’s account and MT 202 is used for payments to financial institutions. (MT means Money Transfer).

As a matter of abundant precaution normally sending branch issue the messages in the format 199 /299 respectively for MT 103/MT 202 stating that the message is duplicated and to ignore the second one. Payment acknowledgement bears the notation “Possible Duplicate Emission” (PDE).

SWIFT codes

Swift code is a standard format of Business Identifier Codes (BIC) approved by the International Organization for Standardizations (ISO). Swift code is called in different names like ISO 9362, SWIFT-BIC, BIC code, SWIFT Id. It is also called as Business Entity Identifier (BEI) when the code is assigned to non-financial institutions.

The SWIFT code will be formatted in 8 or 11 characters, in the following format.


  • First 4 letters: Institution Code or bank code.
  • Next 2 letters: ISO 3166-1 alpha-2 country code
  • Next 2 letters or digits: location code
  • Last 3 letters or digits: branch code ((In case of  last 3 digits/letters are ‘XXX’ it means message is meant for primary office)

Illustration-1: The SWIFT code CITIINBXBLR can be breakdown as under.
CITI is for Bank code-(CITI Bank), IN is for Country code – (India), BX is for Location code – (Location of CITI bank), BLR is for Branch Code of CITI bank (Bengaluru branch).

Illustration-2:  SWIFT code IOBAINBB089 can be breakdown as under.

IOBA is for Bank Code (Indian Overseas Bank), IN is for country code – (India),BB is for  Location code of IOB, 089 is for branch code of IOB (Mumbai Thane).

SWIFT publishes the User Hand Book, International BIC Directory, and News-Letter called Swift World.



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