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byAlma Abell
The Swift MT760 is really just a specific type of message, but an essential guarantee, sent between banks and between banks and large corporations and other specific types of non-financial entities. The entire system was created by a company in Belgium, SWIFT Standards Laboratory Private Limited, that was developed in 1973. The acronym SWIFT actually stands for Society for Worldwide Interbank Financial Telecommunication.
The Message
Each and every SWIFT message has five segments or five blocks of information or data. They have to be sent using the correct format for each block of data that includes three different headers, the actual message or the content, and then a closing which is known as the trailer. Each component has to be entered correctly or the bank receiving the message will not process the incoming information.
The Swift MT760
With the Swift MT760 the MT, which is similar in all SWIFT messages, simply means “message type” the next data point, the 7 means that it is described as falling into the “Documentary Credits and Guarantees” category.
The other two numbers, the 6 and the 0 indicate that this is a direct to the bank communication that will guarantee that the bank sending the message, the client’s bank, is guaranteeing all the details and information contained in the message.
Another way to think of this is that the message says, between the banks involved, that the buyer’s bank is going to provide a full guarantee for the terms of the agreement as stipulated to the seller’s bank. The buyer’s bank is able to do this because when they issue the Swift MT760 they place a hold on the funds in the buyer’s account to cover the guarantee.
The information contained in a Swift MT760 must be very specific to meet the legal requirements of the issuing bank. This will include very precise wording that , which not all banks and financial institutes will do.
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