The Swift system is a secure instant messaging system for financial transactions that connects banks across the world. To be clear, Swift is a system that does not transfer money, but rather transmits messages to exchange these funds and sends instructions and commands informing users when payments are to be sent and received.
And the word SWIFT in English (SWIFT) is an abbreviation for the phrase “The Society for Worldwide Financial Telecommunication between Banks.” Its idea originated at the end of the sixties with the development of global trade and was established in Belgium in 1973. The system links more than 11,000 banks and financial institutions in about 200 countries around the world.
It depends on an eight-digit numbering system when it indicates the main branch of the bank, or it consists of eleven characters when it refers to a bank branch, the first four digits of the financial institution code, followed by two digits for the country code and two digits for the city name, and the remaining three digits refer to a specific branch from the bank.
In 2021, more than 42 million messages were sent per day through this system, an increase of 11.4% over the year 2020, and through it, transactions and financial transfers in trillions of dollars are carried out between companies, banks and governments. The other system operates 24 hours a day and provides an element of security.
But how were banks dealing before "Swift"?
Before the Swift system, there was "Telex" as the only means available to confirm international correspondence, but it had drawbacks such as slowness and security concerns. Facilitate and secure financial transactions” under the supervision of the National Bank of Belgium and in cooperation with major central banks including the US Federal Reserve, the European Central Bank, the Bank of England and the Russian Central Bank.
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