The Russian Central Bank is talking up its SWIFT alternative as they try to go it alone without a way into the international banking network.
With Western nations and their allies enacting a SWIFT ban on Russian banks following initial resistance from nations such as Germany, Tass reported that the Central Bank’s Governor Elvira Nabiullina considers its what it calls the Financial Message Transfer System (literal translation, Romanized Russian acronym: SPFS) to be a direct replacement for SWIFT.
She claimed that while the system’s membership currently comprises “mainly Russian and Belarusian banks,” a number of banks hailing from Kyrgyzstan, Armenia, Tajikistan, Cuba, and Kazakhstan are already onboard.
Nabiullina added that “foreign financial market participants” also “have the opportunity to join the Russian version of SWIFT.”
Nabiullina was speaking after a meeting with the bank’s board of directors, and was quoted as saying:
“We have a financial messaging system named SPFS, which can replace SWIFT domestically. Participants from abroad can join it. We have developed the internal financial infrastructure, so it will continue to operate smoothly.”
On social media, some suggested that Russia – which has been speaking about developing a SWIFT alternative for several years – had been working on its banking alternative since 2014, when it was also hit with economic sanctions.
One observer on Twitter noted that the wheels of SPFS were put in motion “in 2014,” “because Russia had already seen [a SWIFT ban] coming.”
Indeed, as Cryptonews.com reported last year, Anatoly Aksakov, the Chairman of the State Duma (Parliamentary) Committee on Financial Markets and the Chairman of the Council of the Association of Banks of Russia, efforts to “phase out the USD” already make up part of the Kremlin’s “long-term economic plan.”
Tass noted that the first SPFS pilots were conducted back in 2014, and that while the network is interoperable with SWIFT, it can be used entirely independently of the latter.
The state-run news agency added that “initially, it was intended only for domestic Russian users,” but by April 2021, more than 20 Belarusian banks had been connected.
The media outlet added that “subsidiaries of large Russian banks in Germany and Switzerland” also have access to SPFS, and that “negotiations are underway” to enable SPFS settlements “with China.”