Payment rails

BIC / SWIFT code

Code identifying a financial institution on the international network, still required outside the SEPA area.

A BIC identifies a bank, not an account: eight or eleven characters encoding the institution, country, location and optionally the branch. It is used to route a payment to the receiving institution.

Inside the SEPA area the BIC is no longer needed since the IBAN-only principle became general: the IBAN country code plus interbank directories suffice. It remains essential for an international transfer outside SEPA, where the absence of a common directory forces you to name the bank explicitly, and sometimes an intermediary bank too.