Understanding the strategic role of SWIFT pre-advice messages in Trade Finance operations.
✅ Executive Summary
The MT799 is one of the most misunderstood yet critical SWIFT messages in international trade.
While it does not transfer value, it plays a decisive role in building trust, confirming intent, and triggering subsequent instruments like the MT760 (SBLC/BG) or MT700 (LC).
In 2025, with compliance tightening and counterparties demanding proof of seriousness before committing capital, the pre-advice stage—through MT799 or MT705—has become the new credibility standard in Trade Finance.
“A clean MT799 can open doors that money cannot—because it signals readiness, reputation, and regulatory compliance.”
✅ 1. What Is MT799?
The SWIFT MT799 is a free-format message used for authenticated bank-to-bank communication related to trade finance.
It allows banks to convey intentions, confirmations, or references regarding upcoming instruments or transactions.
Key Facts:
Category: 7 (Trade Finance)
Nature: Non-binding, non-transferable, non-monetary
Purpose: Pre-advice or information exchange before formal issuance of MT700/760
Typical Rule Framework: UCP 600, ISP98, or URDG 758 (depending on the final instrument)
In simple terms, MT799 = “bank-to-bank letter of intent” — authenticated through SWIFT.
✅ 2. The Purpose of MT799 in Deal Execution
🔹 Pre-Issuance Confirmation
Confirms that the issuing bank intends to release an instrument (LC, SBLC, or BG).
Helps counterparties prepare documents or compliance checks before formal issuance.
🔹 Proof of Funds or Readiness
Used to show that the applicant’s funds are available or reserved for the upcoming operation.
Adds a layer of confidence for providers, monetizers, or suppliers.
🔹 Trigger for Escrow or Compliance Release
Many escrow trustees or collateral managers require a clean MT799 before releasing contracts or activating SWIFT RMA links.
🔹 Cross-Bank Coordination
Synchronizes actions between issuing, advising, and receiving banks—especially in multi-corridor trade (e.g., Dubai–London–Singapore).
The MT799 doesn’t send money—but it unlocks every door leading to it.
✅ 3. MT799 vs MT760 vs MT700: The Operational Sequence
| Step | SWIFT Type | Instrument | Purpose |
|---|---|---|---|
| 1 | MT799 | Pre-advice | Non-binding communication of intent |
| 2 | MT700 | Letter of Credit | Formal issuance under UCP 600 |
| 3 | MT760 | SBLC or Bank Guarantee | Binding commitment under ISP98/URDG 758 |
| 4 | MT199/999 | Free text updates / administrative | Status or amendment messages |
Simplified flow:
Banks and providers view the MT799 as the “litmus test” of deal seriousness.
✅ 4. Core Fields in an MT799 (Simplified Example)
Key Fields:
| Field | Meaning |
|---|---|
:20: | Reference number (unique transaction ID) |
:21: | Related reference (if linked to LC/SBLC application) |
:79: | Narrative (main message content) — free text zone |
✅ 5. The Power of the Pre-Advice (MT799 and MT705)
Pre-advice messages are the prelude to a real instrument.
They serve three simultaneous functions:
Signal readiness — confirms the issuer’s operational and liquidity capacity.
Accelerate due diligence — allows the receiving bank or counterparty to verify identity, compliance, and SWIFT authenticity before committing.
Protect all parties — ensures that no SWIFT message (like MT760) is sent blindly, reducing the risk of fraud or non-performance.
Typical Pre-Advice Types:
MT799 (SBLC/BG context) → signals upcoming MT760
MT705 (LC context) → signals upcoming MT700
A legitimate pre-advice acts as a “digital handshake” between banks.
✅ 6. Strategic Advantages for Operators
| Advantage | Description |
|---|---|
| Credibility Boost | Shows bank readiness and seriousness—especially in B2B and interbank deals |
| Faster Compliance | Pre-verified KYC/AML accelerates subsequent SWIFT issuances |
| Reduced Transaction Risk | Ensures that both sides validate identity before instrument flow |
| Improved Liquidity Access | Monetizers and investors often accept pre-advised deals as “pipeline verified” |
| Facilitates Escrow Activation | Enables escrow or trustee funds to be unlocked upon verified pre-advice |
✅ 7. Typical Scenarios Where MT799 Is Used
🔸 Scenario 1: Pre-Advice Before SBLC Issuance
A provider sends MT799 to the client’s bank confirming readiness to issue MT760 SBLC.
The client uses this pre-advice to initiate escrow or regulatory filing.
🔸 Scenario 2: LC Back-to-Back Operation
An issuing bank sends MT705 (pre-advice) to a supplier bank, confirming the LC is approved and issuance is imminent.
🔸 Scenario 3: Proof of Readiness for Monetization
The client’s bank issues an MT799 stating that the funds and RWA (Ready, Willing, and Able) status are confirmed, reassuring a monetizer.
🔸 Scenario 4: PPP or Collateral Trade Preparation
Pre-advice is used to align compliance teams before transferring instruments to liquidity providers.
✅ 8. Risks and Limitations
| Risk | Explanation | Mitigation |
|---|---|---|
| Fake MT799 copies | Many scammers produce PDF “samples” | Always verify via SWIFT confirmation |
| Over-promising by intermediaries | Non-bank actors claiming to “send MT799” | Only banks with RMA connection can issue |
| Misunderstanding non-binding nature | Pre-advice ≠ actual credit | Clarify intent and add disclaimer in message |
| Delayed follow-up instrument | Pre-advice sent but MT700/760 never follows | Set clear expiry period for follow-up |
⚠️ A genuine MT799 must always pass through the SWIFT network, authenticated between two banks with valid RMA (Relationship Management Application) links.
✅ 9. Best Practices for Operators and Providers
🧩 Before Sending MT799
Validate all counterparties through KYC/KYB and BIC registry.
Confirm RMA status between banks (mandatory for SWIFT).
Draft clear, concise text — avoid vague promises.
Include ICC rule reference (ISP98, UCP 600, or URDG 758).
Include legal disclaimer (“This pre-advice is non-binding”).
🧩 After Sending MT799
Follow with MT199 acknowledgment or MT999 confirmation if needed.
Ensure compliance teams track timelines for follow-up issuance.
Maintain audit trail for all SWIFT exchanges.
🧩 For Recipients
Verify authenticity directly with issuing bank via SWIFT callback.
Confirm message reference and SWIFT BIC match.
Do not release funds or goods based solely on PDF versions.
✅ 10. Model Template for a Clean Pre-Advice (MT799)
SWIFT Message Type: MT799
Sender: ABC Bank (BIC: ABCDGB2L)
Receiver: XYZ Bank (BIC: XYZBSGSG)
Text:“We, ABC Bank, London, hereby confirm our readiness and willingness to issue an Irrevocable Standby Letter of Credit in favor of [Beneficiary Name], for an amount of USD 50,000,000 (Fifty Million United States Dollars), under ICC Rules ISP98.
This message serves as a pre-advice only and does not constitute a binding undertaking or payment commitment. The final instrument will be transmitted via SWIFT MT760 upon completion of standard compliance and RMA verification.”
Authorized Signatory,
ABC Bank Trade Finance Department
✅ 11. How Pre-Advices Accelerate the Trade Finance Cycle
| Stage | Traditional Flow | Optimized with Pre-Advice |
|---|---|---|
| KYC & Verification | Begins after instrument issuance | Pre-initiated with pre-advice |
| Compliance Review | Sequential | Parallel |
| SWIFT Network Setup | After draft approval | Pre-confirmed with RMA links |
| Investor/Monetizer Confidence | Based on PDF drafts | Based on authenticated SWIFT messages |
| Issuance Speed | 7–15 banking days | 2–5 banking days |
Result: Faster execution, lower risk, higher confidence.
✅ 12. Conclusion
In the 2025 financial environment, MT799 and pre-advice procedures are not optional — they are strategic tools for transparency, speed, and trust.
They allow operators, banks, and investors to align before committing funds, reducing friction and preventing fraud.
When used correctly, a clean, verifiable MT799:
Confirms credibility,
Accelerates issuance and compliance,
Enables smoother monetization and trade settlement.
A professional operator doesn’t wait for trust — he builds it, one SWIFT at a time.
The MT799 is your first proof that you’re not just ready — you’re bank-ready.
