SWIFT, the Society for Worldwide Interbank Financial Telecommunication, was founded in 1973 to replace telex for standardized international banking messages.
Banks had previously relied heavily on telex, a system that required manual processing and lacked consistent message formats. SWIFT created a secure, standardized network through which financial institutions could exchange payment and settlement instructions.
The cooperative was established by 239 banks from 15 countries and is headquartered in Belgium. Its network does not itself move money or hold customer deposits; it transmits authenticated financial messages between institutions.
SWIFT messaging is often confused with the actual settlement of funds. A bank transfer may use SWIFT messages while the money moves through correspondent accounts or payment systems. The organization’s standardized BIC codes also help identify participating institutions.