Difference between swift code and iba code

Finance / Banking
2023-05-06T01:33:00+00:00

Difference between swift code and iba code

Introduction

Worldwide presence financial, it is common to use various codes to identify bank accounts and make electronic transfers. Among the most used are the Swift code and the IBAN code. Both have different functions and features. In this article, we will delve into the differences between them.

Swift code

The Swift code, also known as the BIC code, is an alphanumeric code that is used to identify banks and financial entities internationally. It is made up of 8 or 11 characters and is mainly used to make electronic transfers between banks in different countries.

The Swift code is made up of the following parts:

  • The first four characters correspond to the bank code.
  • The next two characters correspond to the country code.
  • The next two characters correspond to the bank's location (city).
  • The last three characters are optional and correspond to a specific branch of the bank.

Swift code example

An example of Swift code is as follows: BBVAESMMXXX. In this case, the first four characters correspond to the BBVA bank code, the next two characters correspond to the country code of Spain, the next two characters correspond to Madrid (bank location) and the last three characters identify a specific branch (XXX in this case).

IBAN code

On the other hand, the IBAN code (International Bank Account Number) is a code used to identify bank accounts internationally. It is made up of a maximum of 34 alphanumeric characters that include the account number and other country and bank identification characters. The IBAN is used to make electronic transfers between banks in different countries.

The IBAN code is made up of the following parts:

  • The first two characters correspond to the country code.
  • The next two characters are two check digits.
  • The following characters are the number of the bank account.
  • The last characters include the bank and branch code, if necessary.

IBAN code example

An example of an IBAN code is the following: ES91 2100 0418 4502 0005 1332. In this case, the first two characters correspond to the Spain code, the next two characters are two check digits, the number bank account is the next block (0418 4502 0005 1332) and the last characters are the bank and branch code (not included in this case).

Differences between Swift code and IBAN code

After knowing the definition and structure of each code, we can identify the most important differences between them:

  • The Swift code is used to identify banks and the IBAN code is used to identify bank accounts.
  • The Swift code is mainly used to make international electronic transfers, while the IBAN code is used for both national and international transfers.
  • The Swift code structure includes a greater amount of information than the IBAN code, making it more detailed and precise.
  • The Swift code is shorter than the IBAN code as it contains fewer characters.

Conclusion

In summary, the Swift code and the IBAN code are two very important codes in the financial world. Although both have similar structures, their function and use are different. Knowing the difference between them is essential to making successful international or domestic wire transfers.

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