OUR, SHA and BEN Charge Codes

OUR, SHA and BEN charge codes are the three standard instructions that tell the banks in a cross-border credit transfer how their fees should be divided between the person sending the money and the person receiving it. Under OUR the sender agrees to pay all charges, under SHA (shared) each side pays its own bank and the beneficiary also absorbs any fees taken along the way, and under BEN the beneficiary bears every charge, which are deducted from the amount transferred.

The codes are carried in the payment message itself, most familiarly in field 71A (Details of Charges) of the SWIFT MT103 customer transfer. They express the sender's instruction, not a guarantee: the amount that finally reaches the beneficiary still depends on the route the payment takes, the number of intermediaries involved and the pricing practices of each bank.

An international wire rarely moves directly from the sender's bank to the beneficiary's bank. It usually passes through one or more correspondent banks or an intermediary bank that holds accounts for both sides. Each institution in the chain may charge a processing fee. The charge code tells every party how those fees should be recovered.

• OUR: the ordering customer pays the sending bank's fee and, in principle, all downstream charges. Intermediaries are expected to bill the sending bank rather than deduct from the principal. See the dedicated entry on OUR (Our Charges).
• SHA: the sender pays its own bank's fee; the beneficiary pays the receiving bank's fee and any intermediary deductions. This is the most common choice for commercial payments. See SHA (or Shared).
• BEN: all fees, including the sending bank's fee, are deducted from the transferred amount before it is credited. See BEN (Beneficiary Pays All Charges).

In ISO 20022 messages the same idea is expressed through the Charge Bearer element, using the codes DEBT (debtor pays, equivalent to OUR), CRED (creditor pays, equivalent to BEN), SHAR (shared) and SLEV (charges follow the rules of a named service level, as in SEPA schemes). As the industry migrated from MT to ISO 20022 formats, the three-letter MT codes remained the everyday shorthand used by operations staff and customers.

Suppose an importer sends USD 10,000 to a supplier abroad. The sending bank charges USD 30, one intermediary deducts USD 20 and the beneficiary bank charges USD 15 to credit the account.

• Under OUR, the importer pays USD 30 plus a fee covering expected downstream charges, often an extra USD 20 to 40, and the supplier should receive USD 10,000 less only its own local account fees, if any.
• Under SHA, the importer pays USD 30; the supplier receives USD 10,000 minus USD 20 minus USD 15, or USD 9,965.
• Under BEN, the supplier receives USD 10,000 minus USD 30, USD 20 and USD 15, or USD 9,935.

The gap between the invoice and the amount received is the classic short-paid payment problem, which supplier accounts teams must reconcile against open invoices.

An OUR instruction does not bind every bank in the chain. An intermediary that has no agreement to claim its fee from the sending bank may simply deduct it, and some beneficiary banks charge an incoming-payment fee regardless of the code. Payments routed through markets with limited correspondent relationships are particularly prone to unexpected deductions. SWIFT gpi improved transparency by requiring participating banks to report the fees they take and the amount passed on, which can be followed using the UETR. When a deduction is disputed, the sender's bank may open a payment investigation to claim it back.

Rules differ by jurisdiction. Within the European Economic Area, the Second Payment Services Directive (PSD2) generally requires that, where both payment service providers are located in the EEA, the payer and payee each pay the charges levied by their own provider, which in practice makes SHA the default for intra-EEA transfers, and euro payments in the Single Euro Payments Area carry no deductions from the principal. In the United States, the Dodd-Frank Remittance Rule requires remittance providers serving consumers to disclose fees and the amount the recipient will receive, including certain third-party fees, before payment.

The right code depends on the commercial relationship. Contracts and invoices often state that the payer must remit the full amount, which points to OUR. Payroll and family remittances are also frequently sent OUR so that recipients receive a predictable sum. SHA is the market default for routine trade payments, while BEN is used when the beneficiary has agreed to absorb costs, for example in refunds. Comparing providers on the all-in cost of a transfer, including the FX markup and any downstream deductions, gives a truer picture than the sending fee alone, and the cost structure can vary sharply from one payment corridor to another.