Understanding SWIFT codes is of utmost importance if you are an NRI or sending money to someone outside the country. These identification numbers ensure banks efficiently route the money to intended recipients.

For individuals engaged in international money transfers, it’s important to comprehend how bank SWIFT codes work. Read on to learn everything about SWIFT fund transfers.

What is a SWIFT code?

A SWIFT code (or a Bank Identifier code or BIC) is a globally recognised unique identification code for financial institutions. It is used to facilitate secure and accurate cross-border transactions between banks. The code consists of 8-11 characters, each with a specific meaning.

Swift code acts like a postal code for banks, allowing you to use the beneficiary’s bank SWIFT code as the address. Your bank sends an encrypted message through SWIFT, reaching the beneficiary’s bank.

The message includes the amount and account details, enabling the beneficiary’s bank to identify the transaction’s origin and confirm the money transfer. In no time, the beneficiary receives the funds.

Decoding the SWIFT code format
Every SWIFT code is a unique combination of characters that reveals crucial information about a bank or financial institution.

For example, consider this to be a bank’s SWIFT code – XXXX-YY-ZZ-123. Now, let’s break down the components –

  • Bank code – The first four letters signify the bank’s name in an abbreviated version.
  • Country code – The next two letters indicate the country where the bank is located.
  • Location code – These letters or numbers pinpoint the bank’s headquarters.
  • Branch code – The last three letters represent the specific branch or are indicated as XXX if referring to the main office.

Fortifying payment security through SWIFT
As an NRI, you need a SWIFT code to ensure that your international money transfers reach the correct destination securely. Recognising the importance of secure financial transactions, SWIFT mandates its member financial institutions to comply with 16 fundamental security principles, setting up robust firewalls to prevent financial fraud and ensuring security is a top priority.

The Swift Customer Security Controls Framework (CSCF) encompasses 16 mandatory and 11 advisory controls focused on safeguarding credentials and swiftly detecting suspicious activity. Leveraging the trust of financial institutions worldwide, SWIFT emerges as a reliable guardian for secure cross-border financial transactions.

How to transfer money using a bank SWIFT code?
To transfer money as an NRI using a SWIFT code, follow these steps –

  • Gather information – Begin by collecting all the essential details needed for the transfer. This includes the recipient’s name, the beneficiary bank’s SWIFT code, the beneficiary’s account number, the amount you wish to send, and any additional information your bank may require.
  • Complete beneficiary details – Fill in the beneficiary’s name and account number accurately to avoid errors.
  • Enter SWIFT code – Input the SWIFT code of the beneficiary’s bank. Double-check the code to ensure its accuracy.
  • Verify fees and charges – Check the fees associated with the transfer. International transfers may involve various charges, including foreign exchange fees and correspondent bank fees.
  • Initiate the transfer – Submit the transfer request through your bank’s online banking platform or visit a local branch to initiate the process.
  • Keep track- Once the transfer is initiated, keep track of the transaction using your bank’s tracking services or by contacting customer support for updates. This helps ensure the successful completion of the transfer.

How much time does it take to transfer money through SWIFT?
As an NRI, it’s natural to wonder how much time it takes to process your funds through the bank SWIFT code. Here’s the general process –

  • The moment you initiate a payment, SWIFT’s advanced payment infrastructure takes charge, ushering the details along its intricate network.
  • As the information navigates through the system, it encounters the first correspondent bank, where careful review and processing take place.
  • Making its way through a series of intermediary banks, the payment finally finds its destination in the recipient’s bank account.
  • The SWIFT network skillfully communicates the transfer instructions.
  • Patience becomes key, as the involvement of intermediary banksmeans that SWIFT code payments may take 2-5 working days.

Throughout this journey, the seamless cooperation of correspondent and intermediary liaisons ensures the efficiency and speed of the transaction, making SWIFT a trusted companion in the realm of international financial transfers for NRIs.

SWIFT code vs IFSC code – are they the same?
As an NRI, it’s essential to understand the difference between the SWIFT code and the IFSC code.

The Indian Financial System Code (IFSC) is crucial for transactions within the country, enabling Real-Time Gross Settlement (RTGS), National Electronic Funds Transfer (NEFT), and Immediate Payment Service (IMPS).

In contrast, the SWIFT code is specifically for international financial activities and transactions catering to a broader global scope. Moreover, the two codes differ in length, with a SWIFT code spanning 8-11 characters and an IFSC code requiring precisely 11 characters.

To wrap up
Understanding SWIFT codes is vital for hassle-free fund transfers from your Indian account to any beneficiary’s account globally. Always double-check the bank SWIFT code before initiating a transaction to avoid any unnecessary complications.

Remember, for hassle-free fund transfers from your Indian account to any beneficiary’s account globally, IDFC FIRST Bank is here to provide complete guidance and support.

Visit the nearest IDFC FIRST Bank branch for expert guidance on transferring funds globally.

Also Read: ‘Liberalized FDI makes India hot biz spot for NRI investors’