SWIFT MT-103′s are the most commonly used form of SWIFT communication, and one which many people will have utilized without even knowing it. For most bank customers, they are known not as MT-103′s at all, but rather as wire transfers, telegraphic transfers, or SWIFT transfers. A SWIFT MT-103 is used by the bank when its customers wish to make payment to customers of another bank in another country.
What Is SWIFT?
SWIFT is the Society for Worldwide Interbank Financial Telecommunications. This organization operates a closed network which operates between banks and financial institutions for the purposes of exchanging messages relating to financial information. SWIFT was founded in Brussels, Belgium, in 1973 at a time when it was fast becoming apparent that globalization was a major market force, but banks in various countries were having trouble keeping up with the emerging demand for quickly and efficiently sending money and communicating financial information across borders.
When it was first founded, the SWIFT network operated in just fifteen countries and had less than 300 banks and financial institutions associated with its network. Nowadays SWIFT operates in 208 countries and there are well over 8,000 banking institutions who make use of the SWIFT messaging network.
SWIFT codes are simply a means of differentiating between different kinds of SWIFT messages. The SWIFT messaging network operates using a series of standardized message types. In order to send a SWIFT message, the banking officer simply fills in the appropriate information in the appropriate fields, and sends the message. In order to identify the different types of SWIFT message, there are numbers assigned to each of them. The ‘MT’ prefix stands for ‘Message Type’, and the three digit number that follows it represents a specific message type.
How Do I Send A MT-103 ?
An MT-103 is the most commonly utilized type of SWIFT message. In order to send one, simply contact your bank and let them know that you would like to send a telegraphic or wire transfer. They will require the recipient’s bank details, and also the SWIFT code of the recipient’s bank. If the recipient is not aware of their bank’s SWIFT code, it is a fairly simple matter for the recipient to inquire at their bank.
How Long Does It Take To Send A MT-103?
A MT-103 is sent almost instantly, and if you are the sender, the money is debited from your account directly. It usually takes somewhere between three to five business days for the recipient to see funds in their account, depending on their bank’s processing times, and the origin and destination of the message.
Are MT-103′s Reversible?
No. Once a MT-103 has been made, it is not reversible. Sending a MT-103 is the equivalent of handing someone cash in many respects, so due care should be taken when initiating a MT-103.
Are MT-103′s Common In Sugar Trading?
Yes and no. If the buyer and seller have a good relationship, then they may use a MT-103 to make payments, however standard practices dictate that payment for sugar shipments is made via a letter of credit. Letters of credit are documents which guarantee that the seller will be paid once the sugar has been shipped, and documentary evidence of this has been provided. Paying by MT-103 in advance can leave a buyer open to fraud, and few, if any sellers, will send sugar before they receive payment or a guarantee backed by a major world bank that payment will be made upon shipping.