Do I always need both an IBAN and a SWIFT/BIC?

For most cross-border payments to IBAN countries, yes — the IBAN identifies the specific account and the SWIFT/BIC identifies the bank that holds it. For non-IBAN countries, the SWIFT/BIC is paired with a local account number and any required local routing code instead.

Is a SWIFT payment always slower than a domestic transfer?

Not necessarily, but it can be, because a SWIFT payment may pass through one or more intermediary banks depending on the currency and country pair involved. Major currency corridors typically settle within one to two business days; less liquid corridors can take longer.

Glossary

SWIFT / BIC

The international code that identifies a bank in cross-border payments.

A SWIFT code (also called a BIC) is an internationally standardised identifier for a bank or branch. Cross-border payments typically need both the beneficiary's IBAN and the receiving bank's SWIFT/BIC to route correctly.

In practice

How this works for a UK business

A SWIFT/BIC is 8 or 11 characters: a four-letter bank code, a two-letter country code, a two-character location code, and an optional three-character branch code. The 8-character version refers to a bank's primary office; the 11-character version identifies a specific branch, which some banks require for accurate routing, particularly in markets with many domestic branches operating under one banking group.

SWIFT itself is a messaging network, not a payment system — it carries the instructions between banks that tell them a payment is coming and what it relates to, but the actual movement of funds happens over correspondent banking relationships or local clearing systems. This is why a SWIFT payment can involve one or more intermediary banks between the sending and receiving institution, particularly for less commonly traded currency pairs, each of which can add time and, in some cases, a handling deduction.

Not every payment needs to go via SWIFT. Within the EU and EEA, SEPA payments in euro route over a dedicated regional clearing system rather than SWIFT messaging. Domestic UK transfers use Faster Payments, BACS or CHAPS rather than SWIFT. SWIFT/BIC becomes necessary specifically for cross-border payments outside these regional schemes, or where the receiving bank requires it regardless of scheme.

Worked example

Worked example: a UK exporter is paid by a customer in Japan. The customer's bank needs the exporter's UK bank's SWIFT/BIC (for example, an 8-character code identifying the specific UK bank) alongside the exporter's account number or IBAN, so the Japanese bank's payment instruction can be routed through the correct chain of correspondent banks to reach the UK bank, which then credits the exporter's account.

Pitfalls

Common mistakes

Providing only the 8-character bank-level SWIFT/BIC when the receiving bank specifically requires the 11-character branch-level code for accurate routing.
Assuming SWIFT/BIC is required for all cross-border payments, when SEPA transfers within the EU/EEA and UK domestic transfers use separate schemes.
Confusing a SWIFT/BIC with a routing number or sort code — they serve a similar identification purpose but are not interchangeable formats.
Not accounting for intermediary-bank deductions on SWIFT payments to less commonly traded currencies, which can mean the beneficiary receives slightly less than the amount sent.

FAQs

Frequently asked questions

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SWIFT / BIC

How this works for a UK business

Worked example

Common mistakes

Frequently asked questions

Related reading

IBAN glossary entry

SWIFT vs local payment rails

International payment fees explained

See also

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