Modern life is pretty hard to imagine without making money transfers. They are based on almost all international bidding and doing business. Among the various payment systems, the Swift system is especially popular. Let us consider in more detail what its peculiarity and advantages are.
Definition
The Swift company was formed back in 1973, becoming an association for many American and European financial organizations. The international Swift system set itself the goal of creating such a resource that would quickly and reliably transfer data between different financial structures.
The head office of the company is in Belgium. Over 10,000 large banks from more than 200 countries of the world are already connected to the system.
Every day, Swift passes through itself over a million different operations and payments. In addition to financial organizations, various exchanges, brokers and depositories use the services of the company.
Each bank that is a member of Swift has a unique code, which is an identifier for financial transactions.
Today, the Swift interbank system is considered the undisputed leader in the field of financial payments: it is with its help that clients (both physical and legal) can exchange funds from different countries.
When can I use
The Swift system is recommended for use in the following cases:
- if there is a need to send a money transfer to relatives, relatives or friends;
- if necessary, pay for goods or services;
- if you want to send a large amount with minimal cost;
- if you do not want to open a bank account.
What you need to translate
The Swift system can be used both from an open account and without it, with the possibility of crediting money to the account or with cash payment, and also money can be transferred to the legal entity's account.
In order to complete the transfer, you must specify:
- Swift code of the recipient organization.
- The full name of the financial institution.
- Full details of the recipient (if this is a legal entity, then the full name).
- Beneficiary's account number in international format.
- The name of the bank branch where the transfer will go.
- Details of the intermediary bank.
The Swift system in Russia works exclusively in English. Before submitting an application, it must be verified. If the sender provided incorrect information, then a correction fee will have to be paid. Changing a translation or revoking it can take up to 30 days, especially if errors are detected at the stage of mediation. From the Russian Federation, transfers of this type are sent only from the client’s currency account. Transfer can take up to five days.
Now consider how to get a swift translation. In order to receive money, you need to make sure that they are received on the client’s account or on the bank’s intermediary account. You can find out such information either by phone, calling the bank operator, or through the online account (if you have an open account). If the money has arrived, you need to visit the office of the bank where the account is open, or the branch of the intermediary bank. By presenting a passport, a bank client can receive money. In this case, if the commission was not withdrawn automatically, you will need to pay a fee. If the transfer amount is quite large, before you pick it up, you will need to order it by phone, because not every bank can have large amounts available.
Commission
The Swift money transfer system does not have a specific payment network.In general, tariffs for sending or receiving are set by each financial institution separately. Consequently, each bank - and even more so in each country - will have its own tariffs.
As a rule, both participants of the transfer pay a commission. But despite this nuance, the aggregate of the paid commission will be less if the client wants to make a payment through an instant payment system, where the commission fee is paid only by the sender.
Swift settlement system is more suitable for sending large sums of money starting from $ 1000. This is more profitable for one simple reason: the commission fee starts from 0.5% of the amount, but not less than $ 10. In this regard, it is impractical to transfer small amounts. In this case, the maximum amount is established by the legislation of the sending country.
Is return possible
Banking system "Swift" allows you to make a withdrawal of payment on the personal application of the sender and in certain circumstances. Usually, there are no problems with the money transfer itself. But if the client suddenly needed to withdraw the transfer, this can be done only until the moment the money reaches the recipient. This process takes time.
The commission that was taken for the transfer is not returned to the client of the bank. And if the money has already arrived to the recipient, it is impossible to withdraw it.
Who can come in handy
Despite the fact that there are more popular payment systems, such as Unistream, Western Union and MoneyGram, Swift is considered the most convenient for money transfers between countries. All financial operations carried out in this system are considered the cheapest and most convenient for paying for a number of services. This can be medical care, and tuition, and hotel room reservation, and payment for purchases in stores.
The Swift system is widely used to transfer funds to relatives and friends living in other countries, as well as to pay for various events (conferences, seminars, etc.).
Manual processing
Sometimes there are situations when payments in the system fall into manual processing. With what it can be connected? There may be several reasons for this:
- Incorrect IBAN
- a rather complicated swift payment route;
- a lot of extra information in the purpose of such a payment;
- absence of the beneficiary bank in the details of the swift payment.
In order to avoid hanging the payment and exclude the possibility of manual processing, you should follow a few simple rules for filling out payment cards in foreign currency in the Swift system:
- Since the payment system is a kind of telegram, it should contain a minimum amount of information.
- Payment details can be summarized, even reductions allowed.
- It is imperative to verify the correctness of this information.
Advantages and disadvantages
The Swift payment system has its advantages and some disadvantages. Let's consider them in more detail. The main advantages include:
- a rather high speed of money transfers (the average duration of a transfer is 1-3 days, in some cases a transfer can be received within a few minutes);
- absence of restrictions on the amount of payments (maximum amounts may be limited solely by the legislative norms of the sending country);
- confidentiality of all information (reliability is ensured by special organizational and technical measures);
- the choice of currency for the transfer, as well as for payments in the system;
- the tariff network is much more economical in comparison with other payment systems;
- due to the popularity of the Swift system, transfers can be made anywhere in the world;
- the sender of the money transfer may not have a bank account to transfer funds (in this case, only the maximum payment amount will be limited).
The Swift system, in addition to its advantages, has some disadvantages. These include:
- a money transfer chain may contain several participants, therefore, if an error occurs, the terms of the transfer may be delayed, and the commission for the operation may rise significantly;
- To send a transfer, you need to provide a complete set of details of the recipient, as well as in the presence of an intermediary bank - and its details with the exact full name.
The whole essence of the system is as follows: each participating bank has its own unique identification code for carrying out financial transactions within the state and outside its borders. The path from the sender to the recipient is called the “route”. Several financial organizations can participate in the general chain of payments, and settlement between them occurs through a correspondent account.
The ideal formula for the swift chain is the following scheme: sender - correspondent of the sender - correspondent of the recipient - recipient. The simpler the payment route, the better for the recipient.
What Russian law says
As already mentioned, there are no special restrictions on the amount of the transfer and their number in the system. But these points are not established by the system, but by the legislative norms of the country from which the payment or transfer comes.
In the Russian Federation, FZ-173 “On Currency Control” is in force, which limits the amount of transfer from an individual to another individual abroad. According to this legislative document, within one business day a Russian resident does not have the right to send abroad more than $ 5,000 or the equivalent of this amount in national currency.
If the client sends more than the specified amount or the frequency of transfers does not comply with the established rules, the financial monitoring service based on FZ-115 may require documents from the citizen that will confirm the source of all incoming income.