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Crack the Swift code for sending international wires
Key takeaways
The growth of international commerce has corporate financial managers needing to learn the special language associated with paying vendors overseas with international wires.
This article defines many common terms related to international wire payments, including Swift, BIC/Swift codes and International Bank Account Numbers (IBANs).
Over 70 countries have also adopted the new international standard format for financial messages known as ISO 20022.
As international commerce continues to grow, businesses of all sizes are looking for ways to better understand the world of international banking and how they can ensure their payments get delivered effectively.
“When businesses first start to pay vendors overseas, they are often asked to understand new terms,” says Dawn Hosmer, a vice president and senior product manager at U.S. Bank. “They hear things like Swift BIC or Swift code or IBAN and find themselves looking for help online.”
“The beneficiary or the payee may live in Austria, but if their bank is actually in Germany, that’s important. The country-specific rules and regulations for international wires are based on the country of the bank.”
Crack the code of international wires
International wires can be sent to hundreds of different countries, spanning all 24 time zones, so it’s no surprise that international wires have a language all their own.
Here are answers to some common questions you might have about the terms that make up that language:
What is Swift? In general, when we talk about sending an international wire, we are talking about sending payment messages over the Swift Financial Network. The Society for Worldwide Interbank Financial Telecommunication (SWIFT) is a global member-owned cooperative and the world’s leading provider of secure financial messaging services. It is a service that U.S. Bank and over 11,000 entities worldwide use for initiating cross-border payments to more than 200 countries.
What is a Swift code? The Business Identifier Code (BIC) is an eight- or 11-character code that uniquely identifies an entity on the Swift FIN Network. “If you think of an international wire as an electronic message,” Hosmer explains, “the Swift BIC is like a bank’s email address.”
What do BIC numbers mean? The definition of the 8-character BIC/Swift code has evolved. The first four characters are now the business party prefix, the next two identify the country where the entity is located, and the last two characters are the business party suffix.
Historically, the first four characters of the Swift code defined the entity, but due to bank mergers and acquisitions, new BIC assignments do not follow this convention. So, for U.S. Bank, the BIC ID would be USBKUS44IMT (for International Money Transfer). USBK was assigned as the identifier for U.S. Bank, U.S. is the country, and 44 indicated the location of the bank headquarters.
“The first eight characters are known as the BIC8,” Hosmer says. “If we add a three-character branch code to the end, it will further identify which area of the bank it's going to. The full 11-digit BIC/Swift code is the one our client would give to their customers overseas if they wanted to receive the wire at U.S. Bank.”
What is an IBAN number? IBAN stands for International Bank Account Number. It is a specific account number that is used for cross-border payments and can vary in length between 22 and 34 characters, depending on the country.
For example, if you are sending a wire to the United Kingdom, the first two characters are GB (Great Britain), followed by a two-digit check number, then four characters of the Swift BIC, then a national routing code of six digits, followed by an eight-digit local account number.
“That local account number is equivalent to your checking account number at a U.S. bank,” Hosmer says. “All that other stuff in front of it is to make sure we're delivering it to the right country, the right bank and the right branch of that bank.”
Navigating country-specific information
The key to successful international wire payments is to ask the receiver for all the information necessary for the payment. In addition to the bank identification code and IBAN, you need to know information about who you are paying, for example their name and address, and country of their bank.
“The beneficiary or the payee may live in Austria, but if their bank is actually in Germany, that’s important. The country-specific rules and regulations for international wires are based on the country of the bank.”
Central banks for many countries have imposed rules that must be followed before their banks can accept incoming cross-border payments. For example, many countries now require listing a purpose of payment.
“They need to know that it’s for a legitimate business purpose rather than terrorist funding, money laundering, trafficking, that sort of thing,” Hosmer explains. “At U.S. Bank, we offer dynamic payment templates to make it easier to ensure you are entering the correct information."
How to make international wires easier
U.S. Bank continues to make it easier to make international payments. U.S. Bank is already live with the Swift Global Payment Initiative (GPI), which provides customers with end-to-end payment tracking to make the process easier and more transparent.
U.S. Bank has more exciting developments rolling out in summer 2025. For example, the bank is redesigning the online user experience with digital tools that take the guesswork out of providing wire information, including clickable dropdown menus to select the information to meet the local requirements no matter where in the world your payment is going.
“Our vision is for our systems to seamlessly ask for the required information for each destination country,” Hosmer explains. “We're trying to guide users through all the information required by that country to ensure the wire is successfully transmitted through every bank in the payment chain, so we can ensure the best possible experience.”
ISO 20022 migration
Over 70 countries have already adopted the new international standard format for financial messages known as ISO 20022, including Switzerland, China, India and Japan. In March 2023, Swift also changed its payment formats to align with the new ISO 20022 international standard.
Some benefits of ISO 20022 adoption include:
- common language for payments data
- richer and more granular data to support faster payments and easier reconciliation
- higher straight-through processing rates
As the new standards are introduced, U.S. Bank will continue to keep its customers up to date with the latest developments and support their efforts to align and take advantage of the new formats.
Contact us to learn more about international payments and global cash management.
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