Swift Brief

Brief about SWIFT system & Messages

* SWIFT or Society for Worldwide Interbank Financial Telecommunication provides a network to allow financial and non-financial institutions to transfer financial transactions via different Message types.

* Swift system first started to use the T format which caused a credit and settlement risk as there were no messages or notifications sent to the receiver to be informed of the settlement.

* They then started to think of the Y format which is more reliable, secure and avoids any credit risks.

* RTGS uses several swift messages types such as: (MT 103, MT 202, MY 096, MT 097, ..)

* Each department at the Central Bank has its own Rec.Code (Field 72) on the swift Message.

* As the sender (Bank A) sends a message (MT 103) to the swift system or operator requiring to add or deduct from its balance or others’ balances, several analytical steps take place before the final settlement happens.

* A copy is sent automatically to the central bank- RTGS (MT 096) to assure that the message is right and valid.

* The message enters a pre-settlement phase in which the swift system operated by the Central bank automatically checks the message sent for any mistakes, typos or invalid information.

* The message’s date must be a value date (present or future oriented) – field32.

* The message’s time must be valid (not a past hour) – field 32.

* All transactions must be denominated in the Egyptian Currency (EGP) field 32.

* The reference must be valid and not repeated in any other place in the message – field20.

* There are two ways for the message to go:

1. If there is something wrong with it the RTGS sends a message back to SWIFT (MT 097) - #1 as denial- with the reason and then the Swift send a message (MT 019) to the sender – Bank A – informing him that the settlement didn’t take place.

2. If the Message is accepted and valid, it enters to the settlement phase.

* The sender...