IBAN vs. SWIFT Code: Understanding The Difference

IBAN is also known as International Bank Account Number. It is the international standard for identifying the account numbers. SWIFT or BIC is known as Bank Identifier Code. It is an international standard for bank identification.

What Is A SWIFT Code?

Society for Worldwide Interbank Financial Telecommunication is the full form of SWIFT.

It is assigned not only to financial but also to non-financial institutions. When it is assigned to any business, it might also be called a Business Entity Identifier or even BEI.

Despite this oversized name, it is a bank ID that is well-known worldwide. Unlike IBAN, which identifies certain bank account, SWIFT actually refers to a certain bank such as banks present in the US.

Around 40,000 banks, as well as offices in the entire world, are a part of the SWIFT network.

Its purpose is to let easy transfer of money between different banks mostly from a country to others. Additionally, the banks communicate with one another by using this code.

It can supply software along with other services to the banks as well as other financial institutions.

It allows other institutions to become aware of three main things such as the bank’s name, the location of its head office and the city of the head office.

What Does A SWIFT Code Appear Like?

It is an alphanumeric number that contains information which identifies a bank as well as a branch.

It is either 8 or 11 characters long and it depends on which bank office it actually refers to.

NFBKUS33 is an instance of a SWIFT code that is for Capital One in the city of New York.

It can be broken down for discovering

• A 4-letter bank code
• A 2-letter country code
• A 2-letter location code
• A 2-digit branch code

Where Can You Find A SWIFT Code?

If you reside in a country that takes part in SWIFT, find the number on the bank statement by logging in to the banking system online or by contacting your bank.

If you send any money internationally and require a SWIFT number then ask the recipient for the bank’s SWIFT number to which the account belongs.

What Is An IBAN Code?

International Bank Account Number is the full form of IBAN.

It is one unique number that is assigned to a certain bank account that is involved in the business internationally.

IBAN is used for identifying the bank accounts present in different countries. It is not exclusive to Europe, but IBAN is used in most of the countries in Europe.

US does not make use of IBAN numbers, but you can encounter them while sending money to any recipient internationally by specifying that IBAN number that makes the transactions faster.

IBAN has 2 formats; one is an electronic format that is without blanks and the other is written representation that is with groups of 4 characters which are divided by blanks.

What Does An IBAN Code Appear Like?

It is an alphanumeric number that contains information identifying a bank, account number as well as country.

The length of the code is fixed by a country. It can be till 34 characters long.

GB 29 NWBK 601613 31926819 is an instance of an IBAN code that is for National Westminster Bank in Great Britain.

When a UK IBAN code is broken down the following things are discovered:

• A 2-letter country code.
• A 2-digit transaction number.
• A 4-letter bank code.
• A 6-digit bank sort code.
• A unique number that is specific to a bank account.

Where Can You Find An IBAN Code?

If you reside in a country that makes use of IBAN, then you can find it on the bank statement or by logging to your banking system online. If you wish to send money internationally and require an IBAN number, then ask the recipient for their deposit account’s IBAN number.

What Are The Differences?

SWIFT and IBAN both are used in relation to financial systems. They are used for transactions internationally. So sometime it might be a little tough to understand the differences between SWIFT code and IBAN.

However, both of them are different from the other in various ways. Both the SWIFT and IBAN codes are actually referred to when there is a context of transfers between accounts internationally.

But both are different from one another. The format is different and there are some main differences that lie between them.

In SWIFT code, messages are exchanged securely as well as reliably between various financial institutions globally. On the other hand, IBAN is only primarily used between the European banks. It is used to transfer money electronically from an account to another. SWIFT code is used for both financial as well as non-financial purposes.

Before the introduction of such identification methods, there have been no such methods that were recognized and standardized internationally for identifying bank account.

Introduction of both of the identification methods was important to assist in streamlining the procedure of making some money transfers internationally.