SWIFT Code vs Routing Numbers
SWIFT codes and routing numbers do one thing: identify a bank. They are used by financial institutions to know what particular bank an account is being held in. In a sense, they are a bank’s fingerprint in the financial world. But how are they different?
Routing numbers are 9 digit numbers that are shown on the bottom of negotiable instruments, like checks, as a way to identify the financial institution it is drawn from. It was designed to help sort, bundle, and ship paper checks back to the check issuer’s account. With the implementation of Check 21 in the US, it has found additional use in the processing of paper drafts, direct deposits and withdrawals, and bill payments by the Automated Clearing House.
SWIFT code is an alphanumeric identifier of banks for the purpose of sending or receiving money internationally through wire transfers. It is composed of 8 to 11 alphanumeric characters and the first four letters is the bank code, the next two letters is the country code, the next two letters or numbers is the location code and the last 3 numbers is the branch code.
Difference between SWIFT Code and Routing Numbers
As mentioned earlier, routing numbers and SWIFT codes are used as identifiers for financial institutions. They are there to make sure the money is going to where it should be going. However, the routing number is only used for domestic transfers, those that are within the United States. The SWIFT code, on the other hand, is used for international wire transfers. Also, while the routing number is composed of 9 digits, the SWIFT code is alphanumeric. For example, the routing number for a Chase account is 021000021 while its SWIFT code is CHASUS33.
Think of routing numbers and SWIFT codes as a bank’s fingerprint, it is a unique identifier for that particular bank. It’s just that the routing number identifies a bank within the United States while the SWIFT code identifies a bank internationally.
• Routing numbers and SWIFT codes are unique identifiers for financial institutions. Routing numbers are used for transactions within the US, while the SWIFT codes are used for international wire transfers.
• Routing numbers are 9 digits in length while SWIFT codes can be 8-11 alphanumeric characters.
• Routing numbers are used also for electronic payment processing via ACH, bill pays and paper drafts. SWIFT codes are used for international wire transfers only