The Society for Worldwide Interbank Financial Telecommunication (SWIFT®) is a global messaging network whose primary function is to facilitate the secure exchange of financial messages between its member institutions. With offices located around the world, this member-owned, cooperative organization has over 9000 member institutions in over 200 countries. The Society for Worldwide Interbank Financial Telecommunication does not actually manage accounts or hold the funds of member organizations; it is simply a financial messaging organization. The society securely and confidentially transports proprietary financial data such as stock transactions, payments, and letters of credit between member institutions using its own SWIFT® network.
The organization began in Brussels, Belgium in 1973 with 239 member banks located in 15 nations. The Society’s rules of liability and operational procedures were established at a later date with the initial SWIFT® message being transmitted in 1977. The stated goal of the organization is to establish a worldwide communications standard for processing financial transactions.
Although it does not assist its members with the actual funds transfer, the Society for Worldwide Interbank Financial Telecommunication does send orders for payment that are settled through individual accounts maintained by member institutions. The organization’s member institutions create financial messages formatted for use with the specialized SWIFT® network so that they can be delivered quickly and securely to other members. A vast amount of the financial messages that are transmitted internationally are sent using this specialized network.
The SWIFT-messaging network operated by the Society for Worldwide Interbank Financial Telecommunication is managed by operational centers located in the Netherlands and the U.S. These secure messaging centers share real-time information with each other so that if one of them encounters a problem, the other center can take over the operations of the entire network. The Society for Worldwide Interbank Financial Telecommunication conducts most of its SWIFT messaging services in areas such as payments and cash management, treasury and derivatives, securities, and trade services.
In addition to its financial messaging service, the Society for Worldwide Interbank Financial Telecommunication also offers its members secure personal messaging known as SWIFTNet® mail. This service allows members to send their most important email messages by means of the secure SWIFT network rather than via the open Internet. SWIFTNet® mail is designed for transmitting sensitive documents such as contracts, signatories, and invoices, and is intended to eliminate the need for traditional courier services. The Society first made this service available to its members in 2007.