A bank identifier code (BIC) is a standardized and unique code used to identify a specific bank. Such codes are used for wire transfers, especially internationally, and for financial communications between banks. Some banks list their codes on statements so that people can access them easily, and it is also possible to ask bank officials for the code if it is needed for something such as a wire transfer.
BICs are administered by the Society for Worldwide Interbank Financial Telecommunication (SWIFT). They are also sometimes known as SWIFT codes, and the terms SWIFT-BIC or ISO 9362 may also be used to describe a bank identifier code. “ISO 9362” references the International Organization for Standardization, which devised the standardized format for bank identifier codes to ensure that there would be international consistency.
The first four characters of a bank identifier code are letters which refer to the bank. The next two characters, also letters, are a country code indicating where the bank is located, and the following two characters cite a specific location. Three optional characters can be added as a branch code, in the event that a transmission is not being sent to the bank's headquarters. The location and branch codes may be alphanumeric.
Standardization of bank codes with the use of ISO 9362 accomplished several important goals. The first was that there was a uniform system in place, which greatly reduced confusion and ensured that banks could send communications easily and securely. The use of a bank identifier code also reduces errors, because the code are designed to be logical, making it easy to catch transcription errors and other problems. Standardization also reduces the risk of conflicting codes, which makes it more certain that communications will end up where they are supposed to be, and not at another bank by accident.
When sending money internationally from bank to bank, people usually need a bank identifier code for the transaction, along with specific account information for the recipient. Some banks are willing to look this information up for their customers when they make transfers, although bank employees may caution customers that if they do not have the name and location of the bank right, the money may end up in the wrong location. For this reason, people are usually advised to get the bank identifier code, account number, routing number, and other information needed for a wire transfer directly from the recipient.
Ever since she began contributing to the site several years ago, Mary has embraced the exciting challenge of being a SmartCapitalMind researcher and writer. Mary has a liberal arts degree from Goddard College and spends her free time reading, cooking, and exploring the great outdoors.