What’s the difference between SWIFT and BIC codes?

When you send money internationally, you need to identify the bank or financial services provider you are sending the funds to – within the UK this is done using a 6-digit sort code, but globally there are a few other methods to make sure your money reaches the right bank in the right country.

These include SWIFT and BIC. You may also see the acronym IBAN used. So what are these methods, and what do the letters stand for?

  • IBAN – International Bank Account Number
  • BIC – Bank Identifier Code
  • SWIFT – Society for Worldwide Interbank Financial Telecommunication

You can probably tell from the words used that each acronym applies to a different ‘layer’ or ‘level’ of identifying a specific account – a bit like how a postal address has a town, street name and house number.

IBAN for European bank transfers

Within Europe you’ll usually be asked to provide your IBAN (or the IBAN of the receiving account) when you send money internationally.

This can be anywhere up to 34 characters long and combines identifiers for your country and account provider, as well as your sort code and account number.

Your BIC duplicates some of the information – including the organisation that provides your account, and the country where the account is held – along with a branch identifier similar in function to the sort code.

Most of Europe uses a standardised system based on IBAN and BIC codes, which makes it much easier for banks in different European countries to work together.

Accounts are generally easy to identify and to move money around even across borders, although of course you will still be subject to exchange rates if the accounts are in different currencies.

It’s important to provide both the BIC and the IBAN when they are needed. Without them it might not be possible to transfer the funds, or you may be charged additional fees even if the transfer goes through successfully.

SWIFT vs. BIC codes

So what is the difference between BIC codes and SWIFT? When sending money to an account abroad, they basically mean the same thing.

If you are asked for a BIC code or a SWIFT code, it should be the same 8 or 11-character code to identify your bank or account provider, country and branch.

The reason for the different names is because the Society for Worldwide Interbank Financial Telecommunication – where the acronym SWIFT comes from – can also assign codes to non-financial organisations.

When this happens, instead of a BIC, it’s a Business Entity Identifier, or BEI. So although all BIC codes are SWIFT codes, not all SWIFT codes are BIC codes.

As long as you are sending money though, you don’t need to worry about BEI codes – just make sure you provide the SWIFT or BIC code and the IBAN number if requested.

When to provide your BIC and IBAN

You don’t always need to use your IBAN – sometimes just your UK sort code and account number will be enough.

When sending and receiving money within the UK (including England, Scotland, Wales and Northern Ireland) the account’s sort code and account number should be all you need.

If you are giving your account details to friends and family outside the UK, so they can send you money, they will need your SWIFT or BIC and IBAN numbers.

Make sure they know how to use them:

  • Enter BIC and IBAN codes without any spaces between the letters and numbers.
  • If the code says ‘IBAN’ or ‘BIC’ at the start, remove that part and just give the code itself.
  • Always use BIC and IBAN for international transfers to avoid extra fees or a failed transfer.

If you do some work for a customer in a foreign country and they want to pay you by direct bank transfer, again make sure you give them your details in this format, so they can arrange the international transfer.

As always with personal bank details, it’s a good idea to only give them out when you need to – either to people you trust to send money to your UK account, or to customers based overseas, but usually not also to customers who are in the UK and just need your UK sort code and account number.

So remember:

  • For UK transfers, just your sort code and account number.
  • For international transfers, your BIC and IBAN codes.