SWIFT (Society for Worldwide Interbank Financial Telecommunication) is a private company owned by its members, whose purpose is to operate an international electronic communication network between market players. Most banks and more and more non-bank stakeholders are joining SWIFT.

SWIFT has been operating since 1973 and has become a key player, if not structural, in capital markets. Since its inception, SWIFT supports the development of market activities by providing a key service: communication.

Basically, SWIFT offers its participants a proprietary network, for which it guarantees speed, security, privacy and the inviolability of trade.

On this network, participants have started exchanging standardized messages relating to financial transactions: buy and sell orders, confirmations of trade execution, settlement instructions, payment orders...

This network and these messages have become such a standard that other marketplace infrastructures (public or private) such as TARGET2, Euroclear or Clearstream now rely on one or the other or on both.

From this basic infrastructure, SWIFT has over time built a range of value-added services: SWIFTNet, which relies on the network itself, as well as business-oriented offers such as Accord.

The SWIFT network

The SWIFT network is a proprietary network running on IP whose physical infrastructure is provided by several suppliers for increased security. Beyond the technical details out of the scope of this article, the SWIFT network and its communication protocol offer participants a high level of requirements in terms of speed, reliability (being fully redundant, the network is virtually never down) and security (exchanged messages cannot be hijacked, lost or falsified).

SWIFT also provides the software platform allowing to issue or receive messages over the network: "Alliance".

The SWIFT addresses

Members are identified within the network by their BIC (Bank Identifier Code) with 8 positions:

  • identification of the bank on 4 characters
  • country code on 2 characters
  • city code on 2 characters


A directory available on the SWIFT website allows you to find the SWIFT BIC of an institution or to find the identity of a member from its BIC.

The full address of a sender or receiver consists of 11 characters. The three additional characters that make up the "branch code" are used by the receiver to route the message within its internal information system. If the sender does not know which branch code to use, he can always add "XXX" (e.g. "PARBFRPPXXX") to the first 8 positions. The message will be directed to the right recipient, simply it will not be possible to process it in STP (Straight Through Processing) on ​​arrival in the computer systems of the receiver.

The FIN messaging service

The exchange of financial messages is the core business of SWIFT and the service that everyone knows. The messages are structured according to a specific syntax that allows to generate and interpret them automatically. Moreover, SWIFT performs some checks on the messages: a message whose syntax is wrong is rejected, so that by contrast a message successfully handled to its receiver can be considered as valid by the latter.

The messages are identified by the code "MT" followed by a number with 3 positions. The first digit indicates the category of the message while the following numbers define the specific type of message in its category. As a result, the set of messages in a given category is often designated by "XX", like in "MT5XX" for messages related to securities or even "MT54x" for securities messages used in the context of securities settlement.

Here are the fields related to the market activities covered by the messages:

Category Domain Example
1 Customer payments and cheques MT103: payment order where the originator and / or the beneficiary is not a bank
2 Financial institution transfers MT202: payment order where the originator and the beneficiary are both banks
3 Foreign exchange markets, money markets and derivatives MT300: confirmation of a foreign exchange transaction
4 Collection and cash letters  
5 Securities markets MT502: buy or sell order
MT535: securities account statement
MT541: instruction to receive securities against payment
6 Treasury and precious metal markets, syndications MT600: Confirmation of trading on precious metals
7 Documentary credits and guarantees  
8 Travellers cheques  
9 Cash management and customer status

MT900: confirmation of debit of an account (issued by the account holder, for instance following the processing of an MT202 or MT103 message)
MT950: current account statement

n9 Common group messages MT999: free text message

Value-added services

Communication: SWIFTNet

As the owner and operator of a global network connecting all the major and medium markets players, SWIFT allows customers to use this network for their own communication needs and therefore benefit from its reliability - its main strength. This is the SWIFTNet offer, less known than the messaging service and often misunderstood. The SWIFTNet offer comes in three parts:

  • InterAct allows two remote applications to communicate by exchanging messages in a proprietary format and in asynchronous mode. For example, InterAct is used by the SSP, the TARGET2 platform, to enable the applications of the participants to query the platform. The application of the participant can send a request to know the status of its account, the amount of its credit line, the status of a payment order, etc.
  • FileAct allows the exchange of large messages (files) in a SWIFT "envelope" , thereby including SWIFT authentication and security, but with a totally free content.
  • Browse allows a supplier to provide its customers with remote access to a software application hosted on its servers.

Business services

SWIFT also provides value-added services for the business. The best known is "Accord" that can automatically reconcile MT3xx confirmation messages. On the Forex Spot market, the volumes are huge. By entrusting Accord with the reconciliation of their confirmation messages, participants are released from repetitive tasks and only need to handle exceptions, i.e. unmatched confirmations or confirmations matched with errors.

On the Web

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