Can all banks with Swift code receive international payments or is more needed ?

[Cryptobabaji]

HI All

i have a business account in a small German bank and i would like to receive payments from india
i was in the impression that if a bank has SWIFT code it should be able to receive payments internationally,
but the bank (in this case a trainee) says thatits neither possible to receive or send payments via swift ?
i am confused as all India banks route money to Indian central bank (rbi) convert inr to eur then send across to swift,
so i am not sure why this wont be possible ?

below are the words from the bank ,please note that bank has a swiftcode
'' A bank gets a BIC assigned to its entity, this code is mainly used for their identity in the international payment network.
We are currently on the SEPA network which is the network for all of Europe, we are not on the international network which for example is SWIFT. This means any transaction coming in or out would be returned to sender as atleast 1 of the transacting accounts is not connected to this network. ''

please shed led light on this ,
thanks in advance

 

[Sols]

There are two things here.

India has very strict capital controls. You can't freely convert INR to other currencies or send INR outside of India. It's possible but limited. However, when you do send the money, it may originate from outside of SEPA and as such be a SEPA transaction.

Second is that your bank is not connected to SWIFT. They have a BIC, but they do not have the necessary connections (correspondent accounts or integrations with SWIFT) to transact outside of SEPA. This is quite common with very small banks and EMIs.

If you try to send money from India to this bank account, it will bounce because the recipient is not connected to SWIFT. You will need to transfer the funds first to another bank which has access to SEPA and SWIFT, into which you can receive the funds and only then transfer (over SEPA) to the German bank account.

 

[Cryptobabaji]

Thanks sols for the reply again but this german bank has SWIFT code, it's normally possible to send to banks with swift codes right ?
he also mentioned using a clearing bank like Citi bank.any clue on this ? how much do thy normal cost

 

[Sols]

The term "SWIFT code" is misleading. The bank has a BIC - Bank Identifier Code - which is given to them by SWIFT. BICs are based on an international standard. SWIFT just happens to be the registration authority for BICs. It's easy to think that having a "SWIFT code" (BIC) is the same as being fully implemented with SWIFT, but in reality that's not what having a BIC does.

When SEPA was designed, it was decided to replace local Sort codes and clearing numbers with BICs as a pan-European standard. SEPA, as the name implies, is only for the Eurozone Area. There are many EMIs/PIs and some smaller banks which only trade within SEPA and therefore have a BIC but do not have access to SWIFT for movement (clearing and settlement) of funds outside of SEPA. They use their BIC only for transfers within SEPA.

Citibank is a massive international bank and can provide both SEPA and SWIFT. As I mentioned in my other post, you can use a bank like Citibank to receive the funds from the RBI in EUR via SWIFT and then transfer the EUR via SEPA to your German bank account. But if you do anything high-risk (like crypto), Citibank is not going to accept you.

You will need to find a bank or EMI which provides SWIFT.