What Is the SWIFT Banking System?
Need to transfer money overseas?
Today, it is easy to walk into a bank and transfer money anywhere around the globe, but how does this happen? Behind most international money and security transfers is the Society for Worldwide Interbank Financial Telecommunications (SWIFT) system. SWIFT is a vast messaging network banks and other financial institutions use to quickly, accurately, and securely send and receive information, such as money transfer instructions.
- Society for Worldwide Interbank Financial Telecommunications (SWIFT) is a member-owned cooperative that provides safe and secure financial transactions for its members.
- This payment network allows individuals and businesses to take electronic or card payments even if the customer or vendor uses a different bank than the payee.
- SWIFT, today, is the largest and most streamlined method for international payments and settlements.
- SWIFT works by assigning each member institution a unique ID code (a BIC number) that identifies not only the bank name but the country, city, and branch.
Who Uses SWIFT?
In the beginning, SWIFT founders designed the network to facilitate communication about Basic transactions only. The robustness of the message format design allowed for the huge scalability through which SWIFT gradually expanded to provide services to the following:
- Brokerage institutes and trading houses
- Securities dealers
- Asset management companies
- Corporate business houses
- Treasury market participants and service providers
The SWIFT system offers many services that assist businesses and individuals to complete seamless and accurate business transactions. Some of the services offered are listed below.
SWIFT connections enable access to a variety of applications, which include real-time instruction matching for treasury and forex transactions, banking market infrastructure for processing payment instructions between banks, and securities market infrastructure for processing clearing and settlement instructions for payments, securities, forex, and derivatives transactions.
SWIFT has recently introduced dashboards and reporting utilities that enable its clients to get a dynamic, real-time view of monitoring the messages, activity, trade flow, and reporting.
The reports enable filtering based on region, country, message types, and related parameters.
Aimed at services around financial crime compliance, SWIFT offers reporting and utilities for Know Your Customer (KYC), sanctions, and anti-money laundering (AML).
Messaging, Connectivity, and Software Solutions
The core of the SWIFT business resides in providing a secure, reliable, and scalable network for the smooth movement of messages. Through its various messaging hubs, software, and network connections, SWIFT offers multiple products and services that enable its end clients to send and receive transactional messages.
SWIFT in DOKA SAAS
The interface to SWIFT applications represents an important feature in working with the application. The system is capable of creating outgoing SWIFT messages as well as receiving incoming SWIFT messages to and from a bank's SWIFT application (MERVA or Alliance, for example). The authentication takes place in the bank's SWIFT application. Several services enable the maintenance of SWIFT messages (incoming and outgoing).