A SWIFT transfer, also called an international money transfer, is a secure and standardised method of sending or receiving money from banks anywhere in the world.
What is SWIFT?
SWIFT is basically a messaging system for banks. It works by linking up banks using standardised codes for payments.
The Society for Worldwide Interbank Financial Telecommunication (SWIFT) has been around since the 1970s.
SWIFT is owned by its member financial institutions.
Today, it consists of a network of 11,000 financial institutions located in over 200 countries.
How long does a SWIFT transfer take?
A SWIFT payment generally takes 1-4 working days.
The time taken varies based on the destination, time zones and different banking procedures.
SWIFT transfers aren't instant.
Before your funds are credited to the recipient, they will undergo anti-fraud and anti-money laundering checks, which takes time.
Some banks may also route your money via an intermediary bank if there is no direct relationship between your bank and the destination bank. This can also make the process slower.
What information do you need for a SWIFT transfer?
To send money abroad using SWIFT, you need the following information:
- The name of the person receiving the money.
- The recipient's address.
- The name and address of the bank receiving the money.
- The SWIFT code of the bank (also known as a BIC).
- The recipient's account number or IBAN.
The SWIFT code just identifies the bank.
The IBAN (International Bank Account Number) is longer and identifies a specific bank account.
How to find a SWIFT code?
The SWIFT code, also known as a Bank Identifier Code (BIC), can be found by searching online. It is not personal information, so it is widely available.
Some banks automatically show the SWIFT code on their statements, but this is not always the case.
For security reasons, it is best to get it directly from a bank's website.
Note that you are providing the SWIFT code for the bank receiving your money, not the bank you're sending it from.
An IBAN is longer than a SWIFT code because it also includes specific account information.
IBAN's vary in length depending on the country. They can be anything from 16 to 32 characters long.
There are IBAN generators online that show you the structure of an IBAN for each country.
While it might sound complicated, an IBAN can be broken down into logical parts, so it's a case of piecing it together.
If you are worried about this step, some money transfer specialists, such as ourselves, can always assist you with this.
How a SWIFT transfer works (in 4 simple steps)
Step 1: Identification check
All customers making an international payment need to be identified due to global anti-money laundering rules and regulations.
You may need to email a scan or photo of your passport and a recent bill.
Step 2: Secure an exchange rate
In order to send money from one currency to another, you need to agree an exchange rate.
Once you are ready to move your money, a bank or money transfer company will quote you their current exchange rate.
If you are happy to go ahead, the exchange rate quoted will be locked-in for you.
Step 3: Send in your money
Before any money is converted, your bank or money transfer company will need to receive your funds.
If you use a bank, they will require your funds before you secure an exchange rate. However, if you use a money transfer company, they may allow you can secure a rate before you send in your money.
Step 4: Your money is converted and sent
After your funds have been received, they will get converted into the currency required at the exchange rate agreed.
The funds are then sent using the SWIFT network to the destination bank account.
What does a SWIFT transfer cost?
The cost of a SWIFT transfer varies depending on the bank or money transfer company you use.
There are generally two types of charges to be aware of:
- Exchange Rates
Each bank or money transfer company will charge a combination of fees and exchange rates for SWIFT transfers.
While that can make comparisons tricky, it ultimately comes down to how much money you receive net of all charges.
SWIFT transfer fees
For SWIFT transfers, the big UK banks can charge an assortment of fees.
The most common types are a transfer fee and a recipient fee.
These fees are typically a fixed fee for every SWIFT transfer.
Here are the fees charged by the UK's four largest banks:
- Barclays is no fee online or £25 if you use a branch. They also charge the recipient £6.
- Lloyds charge £9.50 whether online or in a branch, and the recipient is also charged £12.
- HSBC charge £4 online or £9 in a branch, and the recipient is charged £8.
- Natwest charge £15 if under £5,000 or 0.3% (max £40) if over £5,000, and the recipient is charged £7.50.
It is possible you may also be charged correspondent bank fees if an intermediary bank is used in the process of getting your money to its destination.
Also, if you want to speed up your payment, some of the banks also charge a priority payment fee.
The only real way to avoid these fees is to bypass your bank altogether.
Some money transfer companies, such as Key Currency, don't charge any fees for SWIFT transactions.
It not only saves money; it makes it far more straightforward for the customer to know how much money they will receive.
Getting a better exchange rate on your SWIFT transfer
When you search online, there is a lot of talk about SWIFT transfer fees.
I get why: people hate paying fees (me included).
But a lot of customers forget about the exchange rate.
Exchange rates are by no means standardised.
They vary considerably.
And when it comes to exchange rates, even small improvements can make a big financial difference.
In our experience, the big UK banks rarely offer competitive rates.
It's probably because they know some customers will just accept whatever they charge without question.
In fact, I know some people don’t even know what they've actually been charged by their bank for a SWIFT transfer.
Sad but true.
As a ballpark, you can expect the big banks to charge 3%-5% in exchange rate costs on a SWIFT transfer.
The exchange rate will vary based on the amount you send.
The more money you send, the better the rate.
It is worth noting that for larger international transfers, the exchange rate costs tends to be far more significant than the fees.
On a SWIFT transfer of say £120,000, say your bank added a 3% exchange rate margin.
That means they've charged you £3,600 just off the exchange rate.
A lot of money in anyone's books.
It's why you should never just accept the rate your bank is offering.
Another important consideration is that the banks won't provide you with any help on the timing of your SWIFT transfer.
Because exchange rates are continuously fluctuating, timing can be critical.
There will be good times and bad times to exchange your money.
Some money transfer specialists, such as ourselves, are happy to discuss what's happening in the currency market and let you know when the rate moves in your favour.
The point is that a better exchange rate will ultimately put more money in your pocket.
How safe are SWIFT transfers?
SWIFT is a highly secure and reliable payment network that's been used for over four decades. It's estimated that almost half of all cross-border payments globally use the SWIFT network.
Don't forget, though, SWIFT is just a method of communication that moves money from one account to another.
SWIFT doesn't handle the money.
Your bank or money transfer company does that part.
That's why it's worth making sure you are dealing with a company that is Authorised by the Financial Conduct Authority (FCA).
A bank or money transfer company that is Authorised by the FCA must keep all client funds in a safeguarded bank account used only for customer transactions.
That's an important protection.
To find out if a company is Authorised just type their name into the Financial Services Register.
Quick Summary: SWIFT money transfers
SWIFT is a safe and secure payment system that has stood the test of time.
- To make a SWIFT transfer, you can use a bank or money transfer specialist.
- A SWIFT payment can take anywhere between 1-4 working days.
- Banks typically cost more for SWIFT transfers. Don’t be afraid to get an alternative quote.
- Make sure you use a company Authorised by the FCA.
Who are we?
Key Currency is a leading money transfer specialist.
Every day, we help individuals and businesses move their money around the world.
What sets up apart from other companies is we provide a service.
All customers are assisted with their SWIFT payments to avoid any mistakes or hiccups.
We can also discuss your requirements and agree on the right time to exchange your money, rather than using a bank or online-only system, and having to accept whatever rate they give you on the day.
Our rates are highly competitive, and we charge you no fees on SWIFT transfers.
In terms of regulation, we are an Authorised Payment Institution (Financial Services Register register No. 753989). All payments are conducted through safeguarded client accounts held at top tier banks.
Our company has attained a 5-star customer rating on Trustpilot, based on over 700 reviews.
If you would like to compare us to your bank or existing provider, simply request a free quote below.