What is an MT103? Examples, Elements, And Where to Find It

For businesses and freelancers dealing with international clients and cross-border transactions, ensuring that money sent and received arrives safely and on time is essential. 

Whether you're paying suppliers abroad and need to provide evidence of payment, or you're receiving money internationally and want proof of the transaction, one document that plays a crucial role in this process is the MT103.

In this article, we will explore what the MT103 is, how it works, what it contains, how to read its fields, where to find it, and address other FAQs.

An MT103 (Message Type 103) is a standard international message used to complete a SWIFT international transfer between one account to another, typically when one of the account is foreign. This type of transfer is also known as a “Single Customer Credit Transfer.

An MT103 includes a detailed record of all the standardised information required for international transactions, can be used as proof of payment, and is recognised by institutions worldwide.

It can also provide the recipient with all transaction details, including applicable fees and currency exchange rates.

How Does an MT103 Work?

When you initiate a transaction, such as a telegraphic transfer or wire transfer, your bank will prepare an MT103 document that includes all necessary payment details. 

These details include, but are not limited to, your name, your recipient’s name, address, amount, currency, and SWIFT/BIC code. Your bank securely sends this document through the SWIFT network, a dedicated messaging platform for financial institutions. 

The beneficiary's bank receives the MT103, verifies the information, and upon confirmation, credits the recipient’s account with the transferred funds, deducting fees as applicable.

MT103 vs MT202: What’s the Difference

These two documents are frequently confused. They are both messages used in the international transfer system but serve different purposes. The main difference is that MT103 is used for customer payments, while MT202 is used within banks for interbank fund transfers.

An MT103 is a payment instruction containing the details of the sender and the beneficiary. It is used for customer-initiated payments (individual credit transfers) between two parties. On the other hand, An MT202 is used by banks to transfer funds between themselves and for interbank settlements or liquidity management. It also provides instructions to intermediary banks for transferring funds between financial institutions.

As a customer, you will primarily be dealing with MT103 messages when sending or receiving international payments. MT202 messages are used internally by banks to transfer funds among themselves, so they do not concern individual customers.

If you are transferring funds through SWIFT, here are common scenarios where you would need an MT103:

• Proof of Payment or Refund for Suppliers or Clients: The MT103 serves as official proof when you send money internationally. This is particularly important for businesses that need to provide evidence of payments made to suppliers or refunds issued to clients. Your vendors may also require this for reconciliation purpose.
• Verification of Incoming Payments or Refunds: If you are expecting a payment from a client or a refund from a supplier, you can request an MT103. This document confirms that the transfer has been initiated and provides details about the transaction.
• Dispute Resolution: In cases of payment issues, such as a delayed transfer or discrepancies in amounts, the MT103 can assist you in investigating and resolving these problems. A common issue is when the amount received differs from the amount sent, often due to fees deducted by banks during the transaction. The MT103 can help you track this discrepancy.

Keep in mind that if you make an international transfer through channels other than SWIFT, you will not be able to obtain an MT103. If you’re uncertain, consult the institution through which you initiated the transfer.

The MT103 adheres to a standardised format that includes specific information to ensure the validity of the document.

This information includes the sender and recipient's information, the payment amount, and any additional information or instructions. It's important that the message is accurate and complete to ensure the payment processes correctly.

Here is the common information included in an MT103:

• Payment reference, which is a unique identifier for the transaction.
• Name, address, and account details of the individual or company sending the money. The sender may be called the remitter or the ordering customer.
• Name, address, and account details of the individual or company receiving the money. The receiver is called the beneficiary.
• The sending bank’s code 
• The receiving bank’s code
• Settlement date
• The amount of money being sent
• The currency in which the money is being sent
• The date the transfer was initiated
• The payment route between the banks
• Intermediary banks (if applicable).
• Details of fees 
• Who pays the fee, which can be the sender, the receiver, or a shared arrangement between both.

The appearance of an MT103 that the customer gets after the request can vary by bank, but it must include a SWIFT payment message that provides tracking information for the payment destination.

Here's an example of what an MT103 might look like.

The format of MT103 documents can differ from one bank to another. You might find some MT103 documents straightforward to read, while others use predominantly banking abbreviations. 

To help you understand them better, here is a simplified breakdown of the references and abbreviations you may find on MT103 documents. 

MT103 Mandatory Tags

Tags 50 and 59 may use account numbers in BBAN format for domestic payments or IBAN format for international payments.

MT103 Optional Tags

Optional tags are fields that the sender can choose to add. They offer extra information, but not including them does not hinder the processing of the transaction.

Tags 50, 52, 53, 54, 55, 56, and 57 primarily use BICs (Business Identifier Codes) to identify the involved banks.

The MT103 is important because of the following reasons

• It ensures secure transfers: Once a recipient bank receives the MT103, it follows the instructions to credit the relevant account. This written and recorded document can help reduce errors or fraud.
• It serves as proof of payment: The MT103 serves as a formal confirmation of a financial transaction, similar to a receipt. It provides clear documentation that funds have been sent, which can be used for dispute resolution or auditing.
• It simplifies payment tracking: MT103 comes with a unique identifier which can help tracks payment status and confirm when funds have been credited. 

You can request an MT103 document from your bank or financial institution. 

Although an MT103 is always generated for SWIFT transfers, banks do not automatically provide this document to customers. You can request an MT103 from your bank if you need it. Depending on the banks, you may be able to make the request online through your usual banking apps, or you may need to contact customer support to request it. 

The time it takes to receive the MT103 document varies. Banks may take a few business days or more to retrieve and deliver the MT103 because the document is not generally formatted for customer viewing. They need to process it first before making it available. 

Certain non-bank alternatives, such as neobank or fintech companies, may be able to provide this document more quickly—sometimes within a day or even just a few hours—depending on their operational policies.

This is an example of what a request form for an MT103 might look like. Please note that this can vary from bank to bank.

The MT103 is used for SWIFT payments. If your bank can't provide this document, it could be because the transaction isn't processed via the SWIFT network.

How Much Does an MT103 Document Cost?

The cost depends on your institution. Banks typically charge a fee for this document, ranging from USD 20 to USD 50. In contrast, financial technology companies, international money transfer apps, and other non-bank alternatives often provide the document for free upon request.