BIC codes are uniquely developed by the International Organization for Standardization (ISO) to identify banks and their respective branches. These codes are only used by financial institutions for conducting business between banks, making interbank bank transactions and wire transfers. BIC code is generally 8 or11 digits long- 8 refer to primary office of a bank and 11 digits code refer to a specific branch location. The code is essential since it specifies the bank, specific location (country, city) and also branch.
The Bank Identifier Code (BIC) is a common alternate to a SWIFT (Society for Worldwide Interbank Financial Telecommunication) code and both the codes are alpha-numeric usually containing eight to eleven characters. At present, these are more than 9,000 financial institutions are using these identifications codes in over 209 countries worldwide. This code must always come with a bank account number to identify the bank account of the beneficiary. All international fund transfers are made via this advanced system which allows banks to exchange financial data regarding money transfers, account debit and credit, account status and so on.
The importance of the code lies in the fact that a bank cannot identify a payment or a transfer without BIC or SWIFT codes. While make a transaction every bank will preferably ask you to provide the code of a recipient so it is a must to know for it in advance. However, you can still make a money transfer without this bank identification number, but in this case you will have to use the services of a money transfer company or a non-banking provider. A money-transfer company uses internal transaction system to transfer funds; however, senders as well as recipients must provide a valid ID.
Before sending money or travelling overseas, it is essential to familiarize yourself with the particulars of the local banking system of the country you are approaching. This indeed, will help you keep away from common mistakes and…