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IntermediatePayments1 min

SWIFT is a global network of secure messages between banks, used for most international bank transfers. The name is also used for the transfer itself and for the bank identifier code (BIC).

In plain words

SWIFT does not move the money itself. It passes payment instructions to banks (“debit this one, credit that one”) and the funds travel through the banks’ correspondent accounts. That is why intermediary banks with their own fees can appear on the way, and a transfer can take several working days. A bank is identified by its BIC (also called a SWIFT code) of 8 or 11 characters.

Example. A US client pays a Ukrainian sole proprietor in dollars: the client’s bank sends a SWIFT message, the money passes through a correspondent bank and arrives within a few working days, and intermediaries may deduct their fees from the amount.

Related terms

← The whole glossary

Word of the dayInflationBasic

Inflation is a sustained rise in the general level of prices, so that money buys fewer goods and services than before.

Example. Prices rose 10% over the year and your deposit earned 8%: formally you earned something, but you can buy a little less with that money than last year (108 against 110, illustrative numbers).

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