Full Form of BIC – Bank Identifier Code
The full form of BIC is Bank Identifier Code. BIC is also better known as SWIFT ID, SWIFT-BIC, or SWIFT code, and it can be defined as a distinctive alpha-numerical identification code that is approved by the ISO or International Organization for Standardization, and this code generally is required by digital banking applications for the purpose of transferring money between two member banks of the swift network.
Table of contents
- BIC, or SWIFT code, is an internationally recognized identification code for financial institutions in global financial transactions.
- BIC is a unique alphanumeric code comprising either 8 or 11 characters, providing specific details about the bank and its branch location.
- BIC is used in various financial operations, including wire transfers, international payments, and bank communication.
- BIC ensures secure and accurate transmission of financial messages between financial institutions, facilitating efficient and reliable global financial transactions.
Where is the BIC Code Located?
Anyone who lives in a country that participates in SWIFTSWIFTSWIFT is Society for World Wide Inter-Bank Financial Telecommunication and is a platform that provides national financial institutions with a secured, standardized, and encrypted network in a reliable environment for the transfer of various important information from one financial institution to another. or BIC can readily locate their Bank Identifier Code on their paper statements or by making an inquiry in the bank or using an online banking system,i.e., online BIC/ SWIFT tool. Users who are transferring money internationally and for this purpose need a BIC, then they can readily ask the receiving party for their bank’s BIC number.
How to Use the BIC Code?
Bank Identifier Code must always be provided with due care since entering and confirming the wrong code could possibly be the reason behind the monetary transactions getting failed or the money received by some random receiver instead of the intended one. Traditional BIC transfers are now replaced with TransferWise. TransferWise, unlike traditional BIC, happens to be really smart, efficient and helps transactions take place in real-time.
A sender will only need to provide the receiver’s bank details instead of international banking information. On the other hand, a receiver will need to share his or her bank identifier code with the sender. In case a sender is unable to receive the receivers’ BIC, he or she can always look it up online. However, the sender must always ensure to get the receiver’s BIC confirmed before making any transactions with them to avoid any mishaps from taking place.
A bank identifier code is arranged in the following manner:
For example: AAAA-US-11-XXX
- “AAAA” or the first 4 characters represent the bank. The first four characters are used globally to identify a particular bank.
- “The US” or the 5th and 6th characters represent the country in which that particular bank is situated. “US” stated in the above-mentioned example would certainly mean the United States.
- “11” or the 7th and 8th characters represent a location code.
- “XXX” or the 9th, 10th, and 11th characters represent the branch code. It is used to signify an institution or the head office. However, this code is truly optional, and if the same is omitted, then the remaining eight characters code will be assumed to refer to the primary office or head office of the banking institution.
Bank identifier code is generally required by online banking applications to send and receive money between two banks that are obviously the members of the SWIFT network. The sender is not just required to provide the receiver’s local bank account number but is also required to mention the exact bank identifier code of the latter’s bank. Bank identifier code is also required for addressing messages, identifying business parties, and business transactionBusiness TransactionA business transaction is the exchange of goods or services for cash with third parties (such as customers, vendors, etc.). The goods involved have monetary and tangible economic value, which may be recorded and presented in the company's financial statements.. Bank identifier code helps execute financial transactions, complying with the statutory requirements, and so on.
IBAN vs BIC
IBAN and BIC are the two most commonly used systems that are being used by banking as well as other financial institutions of different countries for tracking their money. Both IBAN and BIC help the users in processing their international payments in real time. Now users can make online payments with a lot of ease and convenience and that too, without paying unnecessary additional charges. However, IBAN and BIC may differ from each other on various parameters. The key differences between IBAN and BIC are :
- Full-Form: IBAN stands for International Bank Account Number, whereas BIC stands for Bank identifier code.
- Definition: IBAN can be defined as an alphanumeric code that contains information that helps in the identification of a banking institution, country, and account number. On the other hand, BIC can be defined as an alphanumeric code representing information about a bank and a branch.
- Format: IBAN and BIC codes are up to 34 and 8 or 11 characters long, respectively. The first two letters of an IBAN code represent the country code, the next two letters represent the transaction number, the next four digits represent the bank code, the next six letters represent the bank’s sort code, and the remaining numbers indicate a unique number that is very particular to the bank account.
- Example: GB19 NWBK 235363 96321212. On the other hand, the first four digits of a BIC represent the bank code, the next two digits represent the country code, the next two digits represent the location code, and the last two digits represent the branch code. For example- AAAA-US-11-XXX.
- Where can User Locate IBAN/ BIC: A user can locate IBAN on the bank’s statement or by using an online banking system. On the other hand, a user can locate BIC on the bank’s statement or by using an online banking system or can even inquire for the same in the bank.
The benefits of the Bank Identifier Code are as follows:
- Safe and Secure: Bank identifier code is a safe and secure mechanism for sending and receiving payments internationally. These systems are highly reliable, and the participants will not need to worry about their money getting lost.
- Real-Time Transactions: Bank identifier code enables the participants to execute transactions in real-time. The system is totally automated to avoid any unnecessary delays.
- Cheaper: Bank identifier code system is totally automated, enables the participants to avoid extra charges, and make international payments with a lot of ease and convenience.
A BIC code is essential for anyone willing to transfer money internationally as it is the mechanism through which banking institutions and fund transfer systems tend to identify where the money needs to be sent on an international scale. This code is more of a global postal code that allows banks operating in one country to find the banks operating in another country.
Frequently Asked Questions (FAQs)
You can find the BIC of a specific bank by contacting the bank directly or visiting their official website. Alternatively, you can use online directories or financial platforms that provide BIC lookup services.
BIC is primarily used for international financial transactions. Local bank codes, such as routing numbers or national bank codes, are typically used for domestic transactions within a particular country.
BIC can be used for various financial institutions, including banks, credit unions, and other financial service providers participating in international financial transactions. However, some smaller institutions or local entities may not have a BIC, mainly if they do not engage in international transactions.
This has been a guide to the Full Form of BIC, i.e., (Bank Identifier Code). Here we discuss How to Use the BIC Code with its structure, needs, and benefits. You may also have a look at the following articles –