However, as the exchange expanded, its support for varying deposit, withdrawal, and exchange channels increased. It introduced support for fiat currencies and other methods for its customers to deposit and withdraw traditional currencies. These methods included support for credit/debit cards, third-party payment services such as Paxos, and interbank transfers through the SWIFT network. The SWIFT bank transfer option allows anyone to deposit US Dollars to their Binance account from their local bank account or vice versa. It is easy, and the exchange charges zero fees to transact through SWIFT. This guide will show you how to deposit and withdraw via SWIFT through simple, easy-to-follow steps explaining in detail what each step entails. One thing you’ll notice is that Binance automatically converts USD bank deposits into a cryptocurrency named BUSD. We will explain why the exchange converts your USD deposits into BUSD and what the BUSD cryptocurrency is in greater detail in the guide, so keep reading for that information and much more. For a detailed guide to Binance, check out our comprehensive Binance review. Crypto beginners’ corner:
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What is SWIFT?
Before looking at how to use SWIFT to make Binance fiat deposits, let’s define and explain what the feature entails and why it is a popular international fund transfer method. Several entities make up the SWIFT community, including:
Banks; Corporates; Exchanges; Custodians; Clearing houses; and Investment managers, etc.
The SWIFT’s membership community comprises over 11,000 organizations from more than 200 countries, with each organization receiving a unique identification code to be used for interbank transactions. In a typical transaction such as an interbank deposit between a Binance user and the exchange, the recipient has to specify which bank to which they are making the deposit, and this is done using the SWIFT code. An example of a SWIFT code is BOFAUS3NXXX, representing one of the Bank of America branches. The first four letters of the code (BOFA) represent the name of the bank, and the next two (US) are the country code in which the branch is located, while the next two digits (3N) denote the locality of the institution. Followup digits after the first eight typically represent the branch number.
How to Deposit US Dollars into Binance via SWIFT
There are a few simple steps to follow to make a Dollar deposit from your bank to Binance. The process is simple, but there are some crucial steps to which you need to pay attention to avoid any delay in transaction execution. Step 1 – Visit the ‘Bank Deposit’ page. To do that, visit Binance through the link https://www.binance.com/en and log in to your account. Hover the mouse cursor over the [Buy Crypto] tab on the main navigation bar, then select [Bank Deposit] from the drop-down menu. Binance provides extra information on which bank deposit method is available for each specific fiat currency. The default method is SWIFT bank transfer if you have selected USD, but other currencies may have different default channels. Step 2 – Confirm deposit currency and deposit channel. Binance will prompt you to select the fiat currency you wish to deposit in this step. If you had selected USD from the previous step, it would be highlighted by default on this page. If not, you can click the currency tab to search for the USD option. Below the currency selection tab is the payment selection where you have SWIFT Bank Transfer selected by default. You can choose other payment methods that Binance supports for specific currencies. You will notice under the payment tab that Binance charges zero transaction fees for SWIFT bank transfers. The exchange does not charge for this type of transaction, but the financial institution making the payment will charge the customer. Step 3 – Fill in the transaction amount. In the next screen, Binance will provide an empty form field to specify the amount you wish to deposit. You can choose a preferred amount or click on the [MAX] to deposit the maximum amount that your account supports depending on your verification level. After filling in the amount, click on [Continue] to move to the next screen. Step 4 – Provide bank account details. In this step, Binance will request you to provide the bank account details from where you will send the funds. This screen is only shown if this is the first time making a SWIFT bank transfer. The exchange will automatically load this information for subsequent deposits or withdrawals. Binance allows the addition of up to five different bank accounts. Step 5 – Transfer funds to Binance. In the last stage, Binance will provide you with account details of the receiving bank account. Use them to fill in your transfer form and make sure to include the correct reference code. The reference code helps Binance identify which exchange account to credit with the funds after receiving the deposit. SWIFT bank transfers typically take between 1-4 business days, but sometimes it may take longer if there is a mistake in the process. You can reach out to your bank if the transfer takes longer than expected. Once the bank deposit is successfully processed, Binance will credit your account with the BUSD cryptocurrency equivalent to the USD amount you transferred.
Advantages of Depositing Fiat via SWIFT
Making bank transfer deposit to your Binance account using SWIFT is beneficial in so many ways, including:
It’s cost-effective. Binance does not charge for SWIFT bank deposits; however, the depositing bank may charge transaction fees. It’s ubiquitous. Almost every bank in the world belongs to the SWIFT community meaning most Binance users with bank accounts can take advantage of the zero deposit fees associated with fiat deposits via the SWIFT channel. It’s convenient. Whenever a Binance user deposits USD to their account, those funds are automatically converted into BUSD stablecoin, saving the user the extra step of converting their fiat currency to crypto. This conversion is also free, and any further conversion from BUSD to any other stablecoin such as Tether (USDT) or USD Coin (USDC) is also free.
What is BUSD?
How to Use BUSD
With BUSD coins in your Binance account, there are a few ways to use them. First off, to check your BUSD balance, you need to visit the ‘Fiat and Spot’ wallet by hovering the mouse cursor over the [Wallet] link on the top navigation and selecting [Fiat and Spot]. On the ‘Fiat and Spot’ page, locate the BUSD asset by either searching for it or just scrolling down the page. To the right of each row (asset) is an ‘Action’ panel with options such as ‘Trade,’ ‘Earn,’ or ‘Convert.’ BUSD can be used in the following ways: Trades and conversions – BUSD can be used as a trade asset against other cryptocurrencies like BUSD/ETH or BUSD/BTC. It can also be traded for other stablecoins, including USDT, USDC, and PAX. Binance charges zero fees for any trades between stablecoins. Lend for interest – BUSD can be lent out for a fee with interest rates varying between 0.4% and 1.60%.
Benefits of BUSD
Compared to the US Dollar, BUSD is much easier to use, cheaper to transact, and faster to transfer between accounts worldwide. For example, we highlighted earlier that it takes at least 1-4 business days to make a USD SWIFT bank transfer. BUSD transfers are almost instant, and they cost just a fraction of the USD transfers.
How to Withdraw USD from Binance via SWIFT
Withdrawing USD from your Binance account to your bank account involves two conjoined processes; BUSD to USD redemption and SWIFT transfer. Binance automatically processes the first stage. In the redemption process, the exchange has to burn the BUSD tokens that represent the amount of US Dollars you wish to withdraw to maintain a 1:1 ratio of all outstanding BUSD tokens in circulation. It is a similar process done when depositing USD to your exchange account. Binance will automatically issue BUSD tokens on a 1:1 ratio to match your deposit amount. The second stage of withdrawal is relatively straightforward and easy to complete. Follow these steps: Step 1 – Navigate to the ‘Fiat & Spot’ page. From the Binance homepage (or any page on the Binance website), hover over the [Wallet] link on the top navigation bar and select [Fiat and Spot] from the dropdown menu. Step 2 – Withdraw fiat. On the ‘Fiat and Spot’ page, click on the [Withdraw] button to start the withdrawal process. Step 3 – Specify withdrawal method and amount. Binance will prompt you to specify which asset you want to withdraw in this step. Select USD on the currency tab, which should automatically prepopulate the SWIFT bank transfer withdrawal method. On the right side of the page is a form field to fill in the amount of USD to transfer. Click the [Continue] button to proceed. Step 4 – Provide your bank account details. In the next screen, you’ll need to provide the details of the receiving bank and the account holder’s details. Binance pre-fills the Beneficiary name, so this cannot be changed, and it must match the bank account holder’s name. Fill out the rest of the details and ensure the information is correct. Step 5 – Confirm withdrawal request. Check to ensure that the banking details you provided in the previous step are correct, and click on [Confirm] to continue. Binance will then convert your BUSD tokens into US Dollars and send them to your bank account. The SWIFT bank transfer withdrawal will typically take 1-4 business days, like in the deposit procedure. The funds will be deposited into your bank account if the transaction is successfully processed.
Final thoughts
SWIFT bank deposits and withdrawals are not only quick and easy but cheap as well. Not surprisingly, this combination makes the payment channel extremely popular among Binance users. Other than the time it takes to process a transaction and channel availability, this method has a few other drawbacks.
