The SWIFT system a global network that enables financial institutions
The SWIFT system is a global network that enables financial institutions to send and receive information and instructions about money transfers in a secure, standardized and reliable way. SWIFT stands for the Society for Worldwide Interbank Financial Telecommunication, which is a member-owned cooperative that provides the messaging platform and services. The SWIFT system does not hold or transfer any funds, but it facilitates the communication between banks and other financial entities that use different systems and languages. To do this, SWIFT assigns each member institution a unique code with either eight or 11 characters, known as a bank identifier code (BIC) or SWIFT code. This code identifies the bank name, country, city and branch. The SWIFT system is used for various types of financial transactions, such as cross-border payments, trade finance, securities settlement, foreign exchange and treasury operations. It is also used for regulatory reporting and compliance purposes.