SWIFT is the ‘Society for Worldwide Interbank Financial Telecommunication’, a member-owned cooperative through which the financial world conducts its business operations with speed, certainty and confidence. SWIFT enables customers to automate and standardise financial transactions, thereby lowering costs, reducing operational risk and eliminating inefficiencies from their operations.

SWIFT is solely a carrier of messages. It does not hold funds nor does it manage accounts on behalf of customers, nor does it store financial information on an on-going basis. As a data carrier, SWIFT transports messages between two financial institutions. This activity involves the secure exchange of proprietary data while ensuring its confidentiality and integrity.

SWIFT messages consist of five blocks of data including three headers, message content, and a trailer. They are identified in a consistent manner. They all start with the literal ‘MT’ which denotes Message Type. This is followed by a 3-digit number that denotes the message type, category, and group. The following are the categories of a message:

Oracle Banking Trade Finance interfaces with external payment system for generation of Category 1: Customer Payments and Cheques and Category 2: Financial Institution Transfers messages.

This chapter contains the following sections:

• Collections and Cash Letters
• Securities Markets
• Documentary Credits
• Guarantees and Standby Letter of Credit
• Common Group Messages