The Golden Key to Credit: What is SWIFT MT760 and What is it Used For in Secured Lending?
For large-scale Secured Lending and sophisticated financial operations, the integrity and authenticity of the collateral message is paramount. The SWIFT MT760 is the cornerstone of this process—it is the digital, secure message that transmits a guarantee or security on behalf of a client.
Understanding the function of this specific SWIFT Message is essential for any business seeking reliable Bespoke Collateral Funding Solutions like Collateral Transfer. It is the definitive proof of security in the world of International Finance.
What is a SWIFT MT760?
The MT760 (Message Type 760) is a specific, standardised interbank message used for transferring guarantees and standbys. It is the message used to inform a recipient bank that a financial instrument, typically a Bank Guarantee (BG) or Standby Letter of Credit (SBLC), has been issued.
- SWIFT Message Standard: Like all SWIFT messages, the MT760 uses a proprietary, standardised format that financial institutions worldwide use to exchange information securely.
- Irrevocable Undertaking: The MT760 represents a firm undertaking by the issuing bank (the bank sending the MT760) to honour a financial commitment if the underlying contractual conditions are met. This makes the underlying guarantee a high-grade guarantee.
Primary Uses of the MT760 in Secured Lending
The purpose of transmitting an MT760 is typically to create Security for Funding. It is the legal and technical backbone of any Secured Lending transaction where the collateral is not cash or physical assets, but an institutional guarantee.
1. Collateral Transfer Facilities
In a Collateral Transfer facility—which provides the client with a Bank Guarantee (BG) or SBLC—the MT760 is the instrument of delivery.
- Delivery Mechanism: The Collateral Provider’s bank uses the MT760 to send the BG to the Recipient’s nominated bank.
- Collateralisation: Once received by the Recipient’s bank, the MT760 allows the bank to ledger the value of the BG onto the client’s account. The client can then use this newly received security to approach lenders for lines of credit or loans, effectively achieving Capital Access.
2. Credit Enhancement
The MT760 facilitates Credit Enhancement by placing a high-quality contingent security instrument directly onto the recipient’s balance sheet (or an associated Special Purpose Vehicle). This is vital in complex Structured Finance deals, such as project finance, where the borrower’s underlying credit profile needs strengthening.
3. Trade and Performance Guarantees
Beyond borrowing, the MT760 is widely used to back performance and payment commitments in International Finance:
- Performance Guarantees: Assuring a client will fulfill its contractual obligations in large projects.
- Payment Guarantees: Assuring a lender or supplier that payment will be made, often replacing the need for the transfer of liquid cash collateral.
MT760 vs. Other SWIFT Messages
It is crucial to distinguish the MT760 from other common SWIFT Messages in International Finance:
| SWIFT Type | Message Name | Function | Role in Funding |
| MT760 | Bank Guarantee/SBLC | Transfers Irrevocable Security/Collateral | Enables the loan (acts as security). |
| MT103 | Single Customer Credit Transfer | Transfers Cash Payment | Executes the loan drawdown (sends the cash). |
| MT799 | Free Format Message | Pre-advice/Confirmation | Used for preliminary bank-to-bank communications prior to sending the legally binding MT760. |
By facilitating the secure, verifiable transfer of collateral, the MT760 acts as the definitive message that facilitates credit access for our clients in many secured structures, providing robust Bespoke Collateral Funding Solutions.
Ready to Discuss Your Secured Lending Needs?
IntaCapital Swiss specialises in leveraging the MT760 to provide tailored Credit Enhancement and Capital Access for businesses worldwide.
Contact our experts today to unlock the power of the MT760 and secure your bespoke funding solution.
