According to an annual report released by the Central Bank of Russia, the use of the alternative Swift system in Russia will double in 2020 compared to 2019, with 20.6 percent of the country’s total use.
“The use of SPFS (Note: Russia’s self-developed financial information transmission system) will double in 2020 compared to the previous year, and the share of users in Russia will reach 20.6%,” the Russian central bank said in a recent report on May 7, according to a report by Russia’s Satellite news agency. “
SWIFT is an international system for exchanging messages between banks and completing payments. It is dominated by the U.S. financial system. SWIFT was founded in May 1973 and is headquartered in Brussels, Belgium, and was established primarily to facilitate trading and the creation of an interbank currency clearing system.
But as the dollar in the monopoly position in the global trade and SWIFT information exchange center located in New York, this makes the United States later, can control the system, can use this system to sanctions target enterprises and individuals, even countries, common way is to have been the target of sanctions sanctions may not use the system for international payments.
While the system’s management claims that Swift is politically neutral and independent, it has been used in the past to block some cross-border transactions that the United States does not allow and to enforce American sanctions against several countries.
It follows media reports that Russia could be forced out of the system under Western sanctions. Against this backdrop, Russia has embarked on building its own payment system, the Financial Message Transfer System (SPFS), as an alternative to Swift, reducing its reliance on the dollar and its vulnerability to American sanctions.
In response to the risk that Russia could be forced out of SWIFT, Russia has set up its own financial information transfer system (SPFS). In addition, russian Foreign Ministry spokeswoman Zakharova previously told “Russia Today” interview, in addition to self-built international payment system, Russia also discussed appropriate foreign payment systems, such as Europe’s Single Euro Payment Zone (SEPA), Iran’s SEPAM Agreement, China UnionPay Cross-Bank Settlement System (CUP) and Cross-Border Payment System (CIPS).At the same time, the Russian state payment system MIR is also in operation with foreign counterparts such as China UnionPay, Japan’s JCB and MasterCard, MasterCard’s cross-border debit card.
The European Parliament voted 569 to 67 in favour of adopting a resolution on sanctions against Russia, the Russian satellite news agency reported on April 30, the main content of which is that if Russia is found to have committed so-called “aggression” against Ukraine, Russia will be excluded from the SWIFT system and the Russian-European oil trade and the Nord Stream 2 project will be immediately terminated.