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We live in an undeniably connected world -- especially financially. While transferring money overseas or conducting international transactions may seem like a relatively simple process today, there are many complex moving pieces at play that allow these cross-border transactions to happen. Learn more about SWIFT and its role in supporting the global economy.

What Is SWIFT?

The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is the network that banks and other financial institutions use for transferring information securely. Most major financial institutions use SWIFT, as it is considered the gold standard for reliable and secure financial messaging.

Originally founded in the 1970s, SWIFT was created when banks around the world decided to collaborate to solve the problem of cross-border payments. Today, the globally-owned cooperative is connected to over 11,000 institutions around the world and is connected to more than 200 countries.

What Is a SWIFT Code?

SWIFT's signature method of transferring financial information from one place to another is built around SWIFT codes, unique codes between eight and 11 characters long that are assigned to each financial institution. It is also sometimes called a bank identifier code or ISO 9362 code.

An institution's SWIFT code is actually several different codes strung together. These codes are determined by the following factors:

  • The institution code
  • Country where the institution is
  • Location or city code
  • Individual branch code, if applicable (this isn't always included in SWIFT codes)

In the past, financial institutions used to use a much slower, less secure, and less standardized system for sending payment orders. Rather than using codes like SWIFT, Telex required users to write full descriptions of each transaction. These were often misinterpreted, causing widespread errors and inefficiencies. SWIFT bypasses these issues through standardization. Another factor that makes this method so valuable is that it can be easily updated to suit ever-evolving technologies.

SWIFT Transactions

SWIFT does not transfer actual funds from one place to another. Instead, it sends messages requesting payments between institutions in different nations.

A typical SWIFT transaction is surprisingly simple. For example, if a Wells Fargo (WFC) customer living in Los Angeles wants to send funds to a family member who has an account with Santander Bank (SAN) in Seville, Spain, they would do the following:

  • The American customer would go to their local Wells Fargo branch. They would provide the bank account number of their family member in Spain and the unique SWIFT code of the Santander Bank in Seville.
  • Wells Fargo would send a SWIFT message communicating the request to transfer money to the Santander Bank in Seville.
  • Santander Bank would receive the SWIFT communication from Wells Fargo about the payment and would allow the money to be credited to the family member's account.

This simple process allows money to be transferred safely and securely around the world on a day-to-day basis.


SWIFT has become the gold standard because of its reliability, security level, and scalability. It can also be applied to a wide variety of different industries around the world. However, the SWIFT system is quite versatile and performs many different functions.

Because SWIFT has access to so much data, they made a natural transition into offering services built around reporting for businesses. Many of these services analyze an institution's SWIFT traffic in an informative way that allows stakeholders to make important decisions. On a higher level, SWIFT also takes more granular data and interprets it to identify greater market trends.

Another important service that SWIFT offers is various tools for enforcing financial law and flagging financial crimes. Some of the services they offer include reporting tools for client background checks for investment firms and government sanction violations, as well as flagging and enforcing anti-money laundering regulations.

SWIFT also can support market infrastructures. When unexpected events -- ranging from natural disasters to data corruption -- throw a wrench in day-to-day operations for financial institutions, information security and integrity can be compromised. To combat this, SWIFT offers a Market Infrastructure Resilience Service (MIRS) that helps financial institutions operate under the most compromising of circumstances. MIRS ensures that operations continue safely and securely no matter what challenges the institution may experience.