# Cross-border payments glossary: SWIFT, SEPA, ACH and stablecoin terms explained

56 terms that come up when a company gets paid from abroad, pays suppliers in other countries or uses stablecoins, each in a sentence or two, with a link to the guide that covers it in detail.

By Pavel Skalin, Founder & CEO, Align · Updated 29 October 2026 · 8 min read · https://alignlabs.dev/guides/cross-border-payments-glossary

## The short answer

This glossary explains the terms finance teams meet when they get paid from abroad, pay suppliers in other countries or use stablecoins. Each entry gives the plain meaning and, where Align has one, links to a guide with the detail and sources.

## SWIFT and international wires

- **SWIFT.** The messaging network banks use to send cross-border payment instructions to each other. SWIFT carries the message; the money moves between the banks' accounts, often through intermediaries. See [SEPA Instant vs SWIFT](https://alignlabs.dev/guides/sepa-instant-vs-swift).
- **BIC (SWIFT code).** An 8- or 11-character code that identifies a bank, and optionally a branch, on the SWIFT network.
- **Correspondent bank.** A bank that holds accounts for other banks so they can send and receive payments in a currency or country where they have no presence of their own.
- **Intermediary bank.** A correspondent that a payment passes through on its way to the recipient's bank. Under SHA or BEN, it may deduct a fee from the amount.
- **Nostro and vostro accounts.** Two views of the same account: a bank's "nostro" is its account held at another bank; to the bank holding it, it's a "vostro".
- **UETR.** The unique end-to-end transaction reference, 36 characters, that every SWIFT payment instruction carries, so banks can track it. See [how to track a SWIFT payment](https://alignlabs.dev/guides/track-a-swift-payment).
- **MT103 and pacs.008.** The old and new formats of a SWIFT customer payment message. Since 22 November 2025, Swift has required ISO 20022 for payment instructions, so a payment confirmation is now usually a pacs.008, though people still call it an MT103.
- **ISO 20022.** The international standard for payment messages that SWIFT, Fedwire and many domestic systems have moved to. It carries richer, structured data, such as separate fields for an address.
- **OUR, SHA and BEN.** Charge codes on a SWIFT payment that say who pays the fees. See [international wire fees explained](https://alignlabs.dev/guides/wire-fees-our-sha-ben).
- **Structured address.** A payee address sent in separate fields (street, town, postcode, country) rather than free text. Swift has deferred its plan to reject fully unstructured addresses, which it said it would retime by December 2026.
- **Returned payment.** A payment the receiving bank sends back, for example because the account number or name doesn't match. See [why international payments get returned](https://alignlabs.dev/guides/why-international-payments-get-returned).

## US payment rails

- **ABA routing number.** The 9-digit number that identifies a US bank for ACH and wire payments.
- **ACH.** The US batch network for bank transfers, run under Nacha's rules. Most payments settle within one business day. See [ACH vs Fedwire vs FedNow](https://alignlabs.dev/guides/ach-vs-fedwire-vs-fednow).
- **Same Day ACH.** ACH payments settled on the day they're sent, in fixed windows, up to $1 million per payment.
- **ACH return codes.** Codes a receiving bank uses when it sends an ACH payment back. R03 (no account or unable to locate account) and R04 (invalid account number structure) usually mean the details are wrong.
- **Fedwire.** The Federal Reserve's real-time gross settlement system for US dollar wires. A Fedwire payment is final once processed. It runs on business days, closed on [Federal Reserve holidays](https://alignlabs.dev/guides/ach-vs-fedwire-vs-fednow).
- **FedNow.** The Federal Reserve's instant payment service, live since July 2023 and running 24 hours a day, every day of the year.
- **W-8BEN-E.** The US tax form a non-US company gives a US payer to show it's a foreign entity. See [getting paid by US customers without a US entity](https://alignlabs.dev/guides/get-paid-by-us-customers-without-us-entity).

## Euro payments

- **IBAN.** The international bank account number, up to 34 characters, that identifies an account in Europe and many other countries. A UAE IBAN, for example, has 23.
- **SEPA.** The Single Euro Payments Area: 41 countries where euro payments work the same way, by IBAN, as a domestic transfer.
- **SEPA Credit Transfer (SCT).** The standard euro bank transfer, credited within one business day.
- **SEPA Instant (SCT Inst).** The instant euro transfer, with funds available within 10 seconds, at any hour on any day.
- **Verification of Payee (VoP).** The check a euro-area payer's bank runs on the payee's name against the IBAN before sending: match, close match, no match or not possible. Required on euro transfers in the euro area since 9 October 2025. See [named vs pooled virtual IBANs](https://alignlabs.dev/guides/named-vs-pooled-virtual-iban).
- **TARGET (T2) and TIPS.** The Eurosystem's settlement systems: T2 for large-value euro payments, closed on a few TARGET closing days a year, and TIPS for instant payments, which runs every day.
- **Virtual IBAN.** An IBAN that routes payments into an account held elsewhere. It works like any IBAN for the payer; whether the payer sees your name or the provider's depends on whether it's named or pooled.

## UK payment rails

- **Sort code.** The 6-digit number that identifies a UK bank branch, used with an 8-digit account number.
- **Faster Payments.** The UK's instant payment system, run by Pay.UK, available day and night, up to £1 million per payment at scheme level. See [UK payment rails](https://alignlabs.dev/guides/uk-payment-rails-faster-payments-chaps-bacs).
- **CHAPS.** The Bank of England's same-day system for high-value sterling payments, with no minimum or maximum, closed on bank holidays in England and Wales.
- **Bacs.** The UK system for batch payments such as payroll and Direct Debits, on a three-day cycle.
- **Confirmation of Payee (CoP).** The UK name check on Faster Payments and CHAPS transfers: the payer's bank checks the name against the sort code and account number before the payment goes.
- **APP fraud.** Authorized push payment fraud: tricking someone into sending a payment themselves, for example with fake bank details on an invoice.

## UAE payment rails

- **UAEFTS.** The UAE Funds Transfer System, the UAE's real-time gross settlement system, owned and run by the Central Bank of the UAE.
- **Instant Payment Platform (IPP), or Aani.** The UAE's instant payment system, run by Al Etihad Payments since October 2023, available 24/7.

## Accounts and compliance

- **Named account.** An account, or virtual account, that shows your company as the account holder, so payers' name checks match your name.
- **Pooled account.** An account in a provider's name that holds many customers' money, with each customer identified by a reference.
- **KYB.** Know your business: the checks a provider runs on a company before opening an account, such as registration documents and who owns and controls it. See [business account KYB documents](https://alignlabs.dev/guides/business-account-kyb-documents).
- **UBO.** Ultimate beneficial owner: a person who ultimately owns or controls a company, usually above a shareholding threshold such as 25%.
- **Source of funds.** Evidence of where the money in an account comes from, such as contracts, invoices or bank statements.
- **MSB.** A money services business. In Canada, MSBs register with FINTRAC; Align Payments Ltd. is registered as one (no. N300000203).
- **Travel rule.** The FATF standard that requires providers to send the sender's and recipient's details along with a virtual-asset transfer above a threshold, as banks do with wires.

## Stablecoins and networks

- **Stablecoin.** A token designed to hold a steady value against a currency, usually the US dollar, backed by reserves the issuer holds. See [USDT vs USDC for business](https://alignlabs.dev/guides/usdt-vs-usdc-for-business).
- **USDC and EURC.** Circle's dollar and euro stablecoins. Circle publishes their contract addresses and monthly reserve attestations.
- **USDT.** Tether's dollar stablecoin, the largest by circulation. About half of all USDT is on Tron.
- **Attestation.** An accountant's report that an issuer's reserves matched the tokens in circulation at a point in time. It's narrower than a full audit.
- **Mint and redeem.** Creating new stablecoins against money paid to the issuer, and swapping them back for money. Usually only verified customers of the issuer can do either directly.
- **Network (chain).** The blockchain a token moves on, such as Ethereum, Tron or Solana. The same token on two networks isn't interchangeable without a bridge. See [which network to use for USDT and USDC](https://alignlabs.dev/guides/which-network-for-usdt-usdc-payments).
- **ERC-20, TRC-20 and SPL.** The token standards on Ethereum and other EVM networks, Tron and Solana. "USDT TRC-20" means USDT on Tron.
- **Gas.** The fee a network charges to process a transaction, paid in its own token, such as ETH on Ethereum. On Tron, transfers use energy and bandwidth instead. See the [stablecoin fee tracker](https://alignlabs.dev/tools/stablecoin-fees).
- **Native vs bridged.** Native USDC is issued by Circle on that network. Bridged versions, often labelled USDC.e, are locked on one network and represented on another; Circle doesn't issue them.
- **CCTP.** Circle's Cross-Chain Transfer Protocol, which moves USDC between networks by burning it on one and minting it on the other.
- **Token contract.** The address of a token itself on a network, such as Tether's USDT contract on Tron. It isn't a wallet: tokens sent to it are usually lost.
- **Address poisoning.** A scam that sends you a tiny transfer from an address that looks like one you've used, hoping you copy it from your history next time. See [what to do if you send USDT or USDC to the wrong network](https://alignlabs.dev/guides/sent-usdt-to-wrong-network).

## Stablecoin regulation

- **MiCA.** The EU's Markets in Crypto-Assets Regulation, which sets rules for stablecoin issuers and crypto-asset service providers. See [is USDT MiCA compliant?](https://alignlabs.dev/guides/cash-out-usdt-to-eur-after-mica).
- **EMT.** An e-money token: MiCA's term for a stablecoin referencing a single official currency, such as USDC or EURC. An issuer needs EU authorization.
- **CASP.** A crypto-asset service provider under MiCA, such as an exchange or custodian, which needs authorization to serve EU clients.
- **GENIUS Act.** The US law that sets federal rules for payment stablecoin issuers, signed in July 2025. See [the GENIUS Act for non-US businesses](https://alignlabs.dev/guides/genius-act-for-non-us-businesses).

## Sources

- Swift, [Swift gpi](https://www.swift.com/products/swift-gpi) and [Swift accepts community request to extend structured address migration](https://www.swift.com/news-events/news/swift-accepts-community-request-extend-structured-address-migration-iso-20022-payment-messages) (August 2026, updated September 2026)
- Nacha, [ACH network rules](https://www.nacha.org/rules)
- Federal Reserve, [Fedwire Funds Service](https://www.federalreserve.gov/paymentsystems/fedfunds_about.htm) and [FedNow Service](https://www.federalreserve.gov/paymentsystems/fednow_about.htm)
- European Payments Council, [SEPA Credit Transfer](https://www.europeanpaymentscouncil.eu/what-we-do/sepa-credit-transfer), [SEPA Instant Credit Transfer](https://www.europeanpaymentscouncil.eu/what-we-do/sepa-instant-credit-transfer) and [Verification of Payee](https://www.europeanpaymentscouncil.eu/what-we-do/other-schemes/verification-payee)
- European Central Bank, [Public holidays and TARGET closing days](https://www.ecb.europa.eu/ecb/contacts/working-hours/html/index.en.html)
- Pay.UK, [Faster Payment System](https://www.wearepay.uk/what-we-do/payment-systems/faster-payment-system/) and [Confirmation of Payee](https://www.wearepay.uk/what-we-do/overlay-services/confirmation-of-payee/); Bank of England, [CHAPS](https://www.bankofengland.co.uk/payments/chaps)
- Al Etihad Payments, [Aani instant payments platform](https://aep.ae/en/news-media/insights/aani-instant-payments-platform-redefining-uaes-financial-landscape/) (April 2024)
- FATF, [Virtual assets](https://www.fatf-gafi.org/en/topics/virtual-assets.html) and [Targeted update on virtual assets and VASPs](https://www.fatf-gafi.org/en/publications/Fatfrecommendations/targeted-update-virtual-assets-vasps-2025.html) (2025)
- Circle, [USDC contract addresses](https://developers.circle.com/stablecoins/usdc-contract-addresses) and [CCTP](https://developers.circle.com/cctp); Tether, [Supported protocols](https://tether.to/en/supported-protocols/)
- European Union, [Regulation (EU) 2023/1114 (MiCA)](https://eur-lex.europa.eu/eli/reg/2023/1114/oj/eng)

## Common questions

### What's the difference between an IBAN and a SWIFT code?

An IBAN identifies an account; a SWIFT code (BIC) identifies a bank. A euro payment within SEPA needs only the IBAN. A SWIFT payment usually needs both: the receiving bank's BIC and the account number or IBAN.

### What's the difference between OUR, SHA and BEN?

They say who pays the fees on a SWIFT payment. With OUR, the sender pays everything and the full amount should arrive. With SHA, each side pays its own bank, and intermediaries can deduct their fees from the amount. With BEN, the recipient pays all fees.

### Is a stablecoin a bank deposit?

No. A stablecoin such as USDC or USDT is a token issued by a company that says it holds reserves to back it. It isn't covered by deposit insurance, and how it's regulated depends on the issuer and the country.

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This guide is general information, not legal, tax or financial advice. Rules and providers' terms change; check the sources linked above and take advice on your own situation.

## Related guides

- [SEPA Instant vs SWIFT: speed and cost for business payments](https://alignlabs.dev/guides/sepa-instant-vs-swift)
- [ACH vs wire (Fedwire) vs FedNow: which US payment rail to use](https://alignlabs.dev/guides/ach-vs-fedwire-vs-fednow)
- [USDT vs USDC for business payments: which to hold and which to send](https://alignlabs.dev/guides/usdt-vs-usdc-for-business)
- [International wire fees explained: OUR, SHA and BEN](https://alignlabs.dev/guides/wire-fees-our-sha-ben)