Russia preparing for SWIFT switch-off

REUTERS

REUTERS

The Russian Foreign Ministry has confirmed the country has long been preparing for a possible disconnection from the SWIFT global payment system.

That's according to Head of the Russian Foreign Ministry's Department for Economic Cooperation Dmitry Birichevsky, 24 TV reported.

"Russia has been engaged in this for quite a long time since it is an objective necessity," he said.

According to Birichevsky, Russia has started creating an alternative payment system.

Read also Ukraine's Zelensky, Slovakia's Heger agree Nord Stream 2 undermines energy solidarity in Europe UNIAN memo

The Society for Worldwide Interbank Financial Telecommunication (SWIFT), legally S.W.I.F.T. SCRL, provides a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardized and reliable environment, as per Wikipedia.

Previous developments

In March 2014, Visa and MasterCard halted serving cards of Russia's certain banks in line with the resolution of the U.S. Department of the Treasury. The move affected clients of JSC Rossiya Bank, Sobinbank, InvestCapitalBank, SMP Bank, Bank Finservice, and others.

The said banks were put on the so-called Specially Designated Nationals amd Blocked Persons List, that is, a list of citizens and companies that are subject to U.S. sanctions.

Inclusion in the list meant the freezing of the banks' American assets and a ban on all transactions in any foreign accounts. In addition, the 50% rule was enacted, subjecting to sanctions all organizations in which a person designated in the U.S. Treasury Department's list owns at least a 50% stake.

Russia's Central Bank then made a statement that, if necessary, it would provide support to Rossiya Bank, so that U.S. sanctions don't affect its financial stability.

On March 21, 2014, Chairperson of the State Duma Committee on Financial Markets Natalya Burykina announced that the American payment systems Visa and MasterCard, which stopped cooperating with a number of Russian banks, might be stripped of a license to operate in Russia.

On April 13, 2021, Russian President Vladimir Putin's Press Secretary Dmitry Peskov anticipated Russia might be cut off from the Visa and MasterCard payment systems as part of the Western sanctions policy towards the Russian Federation.

On April 22, 2021, Ukrainian Foreign Minister Dmytro Kuleba called on the European Union to consider the possibility of disconnecting Russia from SWIFT.

On April 29, 2021, the European Parliament adopted a tough resolution targeting Russia, laying down harsh sanction measures in case Russian forces invade Ukraine. In such circumstances, "imports of oil and gas from Russia to the EU be immediately stopped, while Russia should be excluded from the SWIFT payment system, and all assets in the EU of oligarchs close to the Russian authorities and their families in the EU need to be frozen and their visas cancelled."

Translation: Kanaryan Lyudmila, Translating by Yevgeny Matyushenko

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