Russian Central Bank Governor: Alternative to SWIFT Is Already In Place

According to the governor of Bank of Russia, Elvira Nabiullina, Russia will continue global payments via an alternative to the SWIFT network, which is already in place.

SPFS Will Replace SWIFT In Russia

Russia has an internal replacement for SWIFT, Russia’s central bank chief has said.

Last week the European Union, and their allies committed to removed selected, but undisclosed Russian banks from the Society for Worldwide Interbank Financial Telecommunications (SWIFT) — the largest interbank messaging system used for global fund transfers.

The news about cutting Russia from SWIFT was a big blow to the Russian economy. The economic sanctions against Russian banking system, sent the Russian ruble to crash against the U.S. dollar and Bitcoin.

However, Elvira Nabiullina, the governor Russia’s central bank, said the country’s payments infrastructure will continue to function outside the SWIFT. According to her Russia’s internal System for Transfer of Financial Messages (SPFS) can replace SWIFT international payments system internally. Noting the importance to support its banking clients, Nabiullina affirmed that Russia will “fulfill their obligations” on the SPFS system that has been in development since 2014.

However, it’s not fully clear if Russia is able to implement a proper replacement for SWIFT, given that only 23 foreign banks are connected to the SPFS, compared to 11,000 banking members in SWIFT. It will be a challenge for Russia to enable a payments infrastructure that can meet all of its transactional demands.