How to Ensure Security and Data Privacy in Swift Payments?11 min read

How to Ensure Security and Data Privacy in Swift Payments?11 min read

Reading Time: 4 minutes

If you’ve ever had to make or receive an international transfer, you’ve likely encountered SWIFT payments. The SWIFT network underpins much of the global financial system, processing billions of messages each year relating to payments, securities, trade finance and more. But how can you be sure your data and funds are safe when using SWIFT? In this article, we’ll explore what SWIFT is, how it works, and the measures in place to protect your privacy and security.

What are SWIFT Payments?

In its simplest terms, SWIFT (Society for Worldwide Interbank Financial Telecommunication) is a co-operative owned by the banks that use it. It operates a secure messaging network that financial institutions use to send instructions and information to one another, such as international wire transfers. Known as SWIFT payments, these allow clients of member banks to electronically and securely send and receive cross-border international payments.

When you initiate a SWIFT payment through bank, you will provide the necessary details like recipient name, bank account number and bank details. Your bank will then send a secure SWIFT message to the destination bank via the SWIFT network, containing all the required payment information. Once received, the destination bank will credit the recipient’s account. While not involving any currency conversion themselves, SWIFT payments facilitate the settlement of international financial transactions globally on a daily basis.

swift transfers

Are SWIFT Payments Secure?

As the core plumbing of the global financial system, security is of utmost importance to SWIFT. The SWIFT network itself uses dedicated connections between member banks with strict access controls. Messages are encrypted during transmission and include digital signatures for authentication upon receipt. Regular security reviews are conducted by SWIFT to ensure adherence to high technical and operational security standards at participating banks.

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However, any system is only as secure as its weakest link. In 2016, unauthorized access to the banking environment of Bangladesh Bank resulted in fraudulent SWIFT messages and the theft of $101 million. This exposed that while the core SWIFT network security was not directly compromised, vulnerabilities may still exist within individual banks’ internal security perimeters.

Since then SWIFT has implemented additional security measures like two-factor authentication for users and monitoring solutions that can detect anomalies. While no system can be perfectly secure, these enhancements go a long way in bolstering protection. As long as customers only transact with trusted counterparties and banks follow the prescribed security best practices, SWIFT payments can be considered secure.

Is SWIFT a Payment Security Standard?

While SWIFT itself operates securely, it is not meant to be a standalone security standard, but rather a messaging protocol. The security of any SWIFT payment ultimately depends on how both the sending and receiving bank handle security within their own environments.

SWIFT provides guidance and requirements to member banks, but it is up to individual banks to translate this into proper technical and operational security controls. Among other things, this may include measures like:

  • Strict access management and multi-factor authentication systems
  • Regular security training for employees
  • Intrusion detection and logging of system activities
  • Vulnerability scanning and patching of internet-facing services
  • Secure on-boarding of new customers and ongoing due diligence
  • Encryption of sensitive data at rest and in transit

Leading digital banking platforms like The Kingdom Bank not only uphold the stringent security standards mandated by SWIFT but take it many steps further. The Kingdom Bank leverages best-in-class cloud security technologies, implements security by design practices, and undergoes rigorous third-party security validations to keep customer assets and data protected.

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How to Do SWIFT Payments Online?

In the past, international money transfers usually required visiting a bank branch or relying on postal mail. However, with the convenience of online banking now widely available, SWIFT payments can easily be initiated from the comfort of your home:

  • Log in to your online banking portal supported by the digital bank like The Kingdom Bank.
  • Select the “Transfers” or “Payments” section from the main menu.
  • Click “International Transfer” and enter the recipient’s details like name, account number and bank SWIFT code or IBAN.
  • Verify details and enter the transfer amount in the required currency.
  • Select the date of transfer – you can schedule it up to one year in advance.
  • Review all the details and accept any applicable fees.
  • Enter your online banking credentials to authorize the transfer.

Expect the funds to reach the recipient within 1-5 working days depending on the corresponding banks involved in the payment route. The status can then be tracked online. It’s that simple to conduct secure SWIFT transactions with just a few clicks.

swift transfers

How to Open a SWIFT Payments Account in Digital Banking?

Opening an account allowing for SWIFT payments has traditionally required in-person verification at a brick-and-mortar bank. However, with digital-first banking platforms now the norm, this can easily be achieved fully online:

  • Visit the website of a licensed digital bank like The Kingdom Bank that supports SWIFT payments.
  • Click “Open Account” and fill the online application form providing details like name, DOB, nationality etc.
  • Upload clear copies of your photo ID and proof of address.
  • Provide source of wealth details for funds you plan to deposit.
  • Complete any additional Know-Your-Customer checks as required.
  • Agree to the terms and conditions.
  • Verify your identity online using a selfie video session or other due diligence methods.
  • Make your initial deposit and your account is ready to use!
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You’ll receive full online banking login credentials with access to features like international money transfers leveraging the SWIFT network. Your SWIFT account in digital banking allows for seamless movement of funds globally.

Is SWIFT a Secure Way to Send International Payments?

When carefully implemented by participating banks, the SWIFT network provides a highly secure messaging standard underpinning vast financial flows every day. With proper security controls, regular monitoring for anomalies, and by transacting only with known and trusted counterparties, SWIFT can absolutely be considered a secure method of sending and receiving cross-border international payments. However, constant vigilance is required as threats evolve, which is why using a digital bank like The Kingdom Bank offering best-in-class security on top of SWIFT protections is recommended.

Whether you are an individual sending funds internationally or a business needing to make secure supplier payments overseas, leveraging the ubiquitous SWIFT network through a digital platform removes historical friction points in achieving this reliably and securely. The Kingdom Bank streamlines the account opening process fully online, enables easy SWIFT transactions with just a few clicks, and safeguards customer assets and data with cutting-edge security practices actively focused on preserving privacy.

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