A BIC (Business Identifier Code) is a unique identifier for business institutions, approved by the International Organization for Standardization (ISO) . It is also known as a SWIFT-BIC, SWIFT ID, or SWIFT code, after the Society for Worldwide Interbank Financial Telecommunication (SWIFT), which is designated by ISO as the BIC registration authority. BIC was originally defined as Bank Identifier Code and is most often assigned to financial organizations; when it is assigned to non-financial organizations, the code may also be known as a Business Entity Identifier (BEI) .
A BIC code is an 8 to 11-character code that is used to identify a specific bank when making an international transaction. It is almost like a postcode for your bank, ensuring that your money goes to the right place. BIC codes are used to ensure that your payment goes to the right bank when banks send international payments, relying on a network of correspondent banks.
BICs are used by financial institutions for letters of credit, payments, securities transactions, and other business messages between banks. They are composed of a 4-character bank code, a 2-character country code, a 2-character location code, and an optional 3-character branch code.
Banks use BIC codes when transferring money between banks, particularly for international wire transfers or SEPA payments. Both IBANs (International Bank Account Numbers) and BIC/SWIFT codes are used to identify specific banks, but there is an important difference between the two. IBANs are used to identify individual accounts involved in international transactions, while BIC/SWIFT codes are used to identify specific banks.
