Swift
Agenda
What
is Swift What is BKE / RMA Swift Messages / Categories of messages Structured and Free format messages
SWIFT stand for
S W I F
Society for Worldwide Inter Bank Financial
Telecommunication
Swift History
Increase in International trade and commerce after World War-II
Efficient Banking System for payment mechanism with Security, Reliability and Confidentiality was needed. Computer and Telecommunication technology came to rescue.
Co-operative organization SWIFT was born
Swift History
SWIFT is the industry-owned co-operative
Established in 1973
Head quarters at Brussels, Belgium Common language for international financial transactions Secure, Standardised messaging services Provides interface software
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Swift usages :-
Payments Securities Treasury
Trade
SWIFT in figures
208+
Countries Connected
12,946,626 Avg Daily Messages 8147+ Live Users
WHY SWIFT
Advantages
of SWIFT
It is Highly Secured and Reliable It is very cost effective It is Standardized - accepted globally It offers standardized web based trust service and e-payments to corporate customers.
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WHY SWIFT
Disadvantages
of TELEX
Insecure and Slow Transaction Slower transmission Susceptible to transmission errors
Expensive
Most transacting Bank is a SWIFT user and not having test key arrangement for TELEX
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SECURITY
SWIFT Security objectives 1. CONFIDENTIALITY Information is disclosed to authorized persons at authorized location only 2. INTEGRITY Information can be RELIED upon ABSOLUTE, ACCURATE and VALID. 3. AVAILABILITY Information and the associated services is accessible and usable when needed 4. ACCOUNTABILITY Every individual authorized to use the system is 10 accountable
Swift BIC
BIC stands for Bank Identifier Codes It is the unique identification code of a particular Bank / Branch SWIFT handles the registration of these codes The code is 8 or 11 characters 4 characters - bank code
2 characters - country code
2 characters - location code
3 characters - branch code, optional ( 'XXX' for primary office) Where an 8-digit code is given, you may assume that it refers to the primary office. BIC is often called SWIFT addresses or codes
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Examples of BIC
BIC ICICINBB is for ICICI Bank, Mumbai ICIC identifies ICICI Bank IN identifies country code for India BB identifies Code for Mumbai
BIC ICICINBB011 is for ICICI Bank, Andheri 011 identifies Code for Andheri Branch
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RMA Relationship Management Application
RMA is an essential part of the security of the S.W.I.F.T. network.
Previously known as BKE-Bilateral key exchange
Exchanges secret bilateral authentication keys Automatically generates code while sending
It also decodes and confirm while receiving
Once RMA relation established within 2 banks they can send and receive authenticated messages between them.
If No RMA is present then only MT 999 can be exchanged (MT 999 Free format Unauthenticated Message)
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RMA PROCESS
Yes I give you Permission to send me traffic Iam looking for a correspondent in Bangladesh, Are you interested.?
RMA authorization
RMA answer
RMA query
Bangladesh Krishi Bank
Bank of India
Benefits of RMA
Automatically verifies the authenticity of message Smooth process without human intervention Cost saved for processing Processing time reduced Unilateral traffic. Dates / Time can be defined.
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Swift Messages
It is a written communication in a structured format
It is not a file
No Attachments can be sent Message types (MT)
SWIFT message as identified by 3 digit number
Each MT have different Structures / Usages
Message categories
series of MTs relating to a particular class of transaction, as indicated by the first digit of the MT number.
Message Blocks Header, Text , Trailer.
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Categories of Messages
Category
1 2 3
Details
Customer Payments and Cheques Financial Institution Transfers Treasury Markets Fx, Money Market and Derivatives
4 5 6
Collection & Cash Letters Securities Markets Treasury Markets - Precious Metals / Syndications
7 8 9
Documentary Credits & Guarantees Travelers Cheques Cash Management & Customer Status
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Message Blocks
Header: Contains control information Addressee, processing, priority and security. Text Contains the substance of the message. format and structure varies according to the MT
Trailer For control purposes, CHK Trailer, PDE Trailer
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Structured / Free Format Message
X99 in each category are free format message (Example : 799 is Free format message for LC/BG) All other are structured MTs Structured as per Type and use of Message Except 999 all other free format MTs are authenticated
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THANK YOU
