Bank of Russia rolls out alternative to SWIFT

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Bank of Russia rolls out alternative to SWIFT

Russian media reported that a domestic alternative to SWIFT has already aroused avid interest among foreign banks. The Bank of Russia announced that it is going to launch its own system of financial transfers until the year end. The regulator stressed that foreign financial institutions are keen to enter the project. “Nonresidents are about to join the system this year. We have already accepted lots of applications,” first Deputy Governor of the central bank Olga Skorobogatova made comments. Using the Russian system of transferring financial data, foreign partners will be able to evade US sanctions and settle transactions with the Russian companies, burdened by the sanctions. The new system will be available soon to 416 users. Interestingly, there are no foreign companies among them, but it will be open to large Russian companies such as Gazprom Neft and Rosneft as well as public agencies like the Federal Treasury. The idea of the alternative financial network dates back to 2014 when the EU threatened to disconnect Russia from Belgium-based SWIFT. The European Parliament passed a resolution on the ban. However, the SWIFT management rejected this demand. As a result, Russia designed its own system of interbank communication.

Interestingly, Russia is not the only inventor of a competitive equivalent to SWIFT. In the context of the US protectionist rhetoric, the EU has set about developing its own financial network which enables high-value cross-border transactions among its members. Citing Bank of Russia Governor Elvira Nabiullina, Russia has not been invited by the European partners yet.

Published: 2018-10-26 11:51:40 UTC