Bank codes demystified: IBAN and SWIFT

We break down these international systems that move your money among countries.

Banks and other financial institutions work by moving your money around for a profit — for example, paying you a bit of interest to store your money and then lending out your money for yet more interest to other borrowers.

With the volume of transactions running in the thousands daily, how do they keep track of it all? One way is by using a system of unique codes assigned to each bank they do business with. These codes help financial institutions process worldwide transactions with fewer errors and less confusion — all good things when it comes to your hard-earned cash.

These IDs have different names in different countries, but two systems you’ll hear more often are IBAN and SWIFT codes. These codes are internationally recognized by other financial institutions to identify your specific bank among worldwide payments and other transactions.

What is a SWIFT code?

SWIFT is short for the Society for Worldwide Interbank Financial Telecommunication. Despite its oversized name, it too is simply a worldwide bank ID.

Unlike IBAN, which identifies specific bank accounts, SWIFT refers to a specific bank only — including banks in the US. Some 40,000 banks and offices worldwide are part of the SWIFT network.

What does a SWIFT code look like?

A SWIFT number is an alphanumeric number containing information that identifies a bank and branch. It can be eight or 11 characters long, depending on which bank office it refers to.

An example of a SWIFT code is this one for a Capital One in New York City: NFBKUS33.

We can break down this SWIFT code to discover:

• A four-letter bank code.
• A two-letter country code.
• A two-letter location code.
• A two-digit branch code.

Where can I find my SWIFT code?

If you live in a country that participates SWIFT, find your SWIFT number on your bank statement, by signing in to your online banking system or by calling your bank.

If you’re sending money internationally and need a SWIFT number, ask your recipient for the SWIFT number of the bank to which their account belongs.

What is an IBAN code?

Short for International Bank Account Number, an IBAN code is a unique number assigned to specific bank accounts involved in international business. Though not exclusive to Europe, IBAN is used in most European countries. The United States does not use IBAN numbers, but you could encounter them when sending money to an international recipient — specifying the IBAN number makes for faster transactions.

What does an IBAN code look like?

An IBAN number is an alphanumeric number containing information that identifies a bank, country and account number. With lengths fixed by country, IBAN codes can be up to 34 characters.

An example of an IBAN code in at Great Britain’s National Westminster Bank is GB 29 NWBK 601613 31926819.

Breaking down our UK IBAN code, we find:

• A two-letter country code.
• A two-digit transaction number.
• A four-letter bank code.
• A six-digit bank sort code.
• A unique number specific to the bank account.

Where can I find my IBAN number?

If you live in a country that uses IBAN, you can find your IBAN number on your bank statement or by signing in to your online banking system.

If you’re sending money internationally and need an IBAN number, ask your recipient for the IBAN number of their deposit account.

Bottom line

The mysterious IBAN and SWIFT codes are anything but: They identify specific banks among the many financial transactions conducted worldwide among bank accounts. And they’re especially important when it comes to international money transfers.

Learn more about getting the best rates and fees to friends, family and businesses abroad in our guide to international money transfers.

Here’s what people ask about IBAN and SWIFT numbers

• Are SWIFT and BIC codes the same thing?

  Yes. The confusion stems from the fact that the SWIFT system also handles bank identifier codes — or BIC. A bank’s BIC will be the same as its SWIFT code.

• Do banks in the US use IBAN codes?

  No. Banks in the United States don’t use IBAN codes to identify specific banks or account numbers. We instead use SWIFT codes and routing numbers.

• How do I make a wire transfer?

  To initiate a wire transfer, visit your local bank, go to a money transfer office or use an online money transfer specialist. Generally, you’ll complete a form indicating your personal banking information, your recipient’s name and banking information and the amount you’re sending. Once your transaction is complete, you’ll typically receive a tracking number to confirm that your recipient received your funds.