SWIFT stands for Society for Worldwide Interbank Financial Telecommunications and it is through this mode all the illegal letter of undertakings was being routed for Nirav Modi.
Mode of money transfer globally
In general SWIFT is a methodology used world over to facilitate money transfers across lenders. Though a secure mode, it is still to be unearthed how the transactions through this mode didn't came under notice since 2011. But in recent times, fraudulent or suspicious transactions have also been routed through the SWIFT platform.
Origin of SWIFT
An encrypted platform assisting in the fund transfer mainly foreign funds came forth after replacing the earlier financial messaging app TELEX. The messages send across in a standard format reduced the chances of error to a significant degree and was hence deemed as a safer and secure platform.
How money transfer happens via SWIFT?
In case of a transfer via the home branch bank account to an international account, a unique SWIFT code of the recipient is needed to authorize and validate the transaction.
To add to the security of the transaction, a SWIFT transfer in a normal case involves three individuals such as the one initiating the transaction, the other providing the details on the same and the third verifying it.
SWIFT being insisted to be linked to Core Banking Solutions Platform
After the PNB scam sent jitters all through the banking industry, the RBI is now insisting on its integration with the CBS platform as it is still a mystery how these transactions via SWIFT went unnoticed at the PNB. April 1 has been made the deadline for the same. This shall be to boost the internal control of the banking industry.