What Is MT199 and How Is It Used in Trade Finance?
What Is MT199 and How Is It Used in Trade Finance?
MT199 is a free-format SWIFT message used for general bank-to-bank communication. In trade finance, it can confirm preliminary information or the existence of funds, but it carries no binding financial commitment.
MT199 is one of the most misunderstood SWIFT messages in the trade finance world. If someone tells you an “MT199 proves funding is real,” you’re only hearing half the story. This post breaks it down clearly—what it is, when it’s useful, and when it’s not.
MT199 Is a Free-Format SWIFT Message
MT199 is part of the SWIFT message family—a global standard used by financial institutions to securely send payment instructions, confirmations, and other messages. It’s what banks use to talk to each other in coded language.
But MT199 is not a payment. It’s not a guarantee. It’s not a commitment to fund.
What an MT199 Can Be Used For
- Pre-advice of a pending SWIFT message (e.g., alerting a beneficiary that an MT760 is coming)
- Confirming that a client is known to the bank
- Providing basic, informal assurance of intent—like a soft POF
- Sending tracking numbers or SWIFT reference data
It’s an informational message—useful, but not legally binding.
What an MT199 Cannot Do
- It cannot confirm blocked funds
- It cannot act as proof of settlement
- It cannot replace an MT799 or MT760
- It is not considered valid collateral for issuing instruments
If someone offers you “an MT199 showing funds are in place,” ask what it’s backed by. Unless it’s followed by a binding message (like MT799 or MT760), it’s just a bank-to-bank note.
Common Scenarios Where MT199 Is Used
- A buyer’s bank notifies the seller’s bank that an SBLC will be issued shortly
- A bank confirms basic client information without issuing a guarantee
- Counterparties use it to pre-coordinate document exchanges
How Financely Uses MT199 (When It Matters)
We use MT199 as part of pre-issuance coordination—for example, when preparing for an SBLC, DLC, or back-to-back structure. But we never treat it as more than what it is: a communication tool. Real execution still requires real underwriting and binding instruments.
Need Help Issuing a Real Trade Instrument?
We help clients coordinate DLCs, SBLCs, and structured trade transactions the right way—from MT199 pre-advice to final MT760 issuance.
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