The BRICS alliance is reportedly considering the launch of a global payments system that could bypass SWIFT, the banking industry standard. The finance ministers of Brazil, Russia, India, China, and South Africa are evaluating the feasibility of a unified payments network and plan to discuss its potential at the upcoming BRICS meeting. Russian Finance Minister Anton Siluanov states that the network would support the creation of independent payment messaging systems. This news follows the recent decision by BRICS to include Saudi Arabia, Iran, Ethiopia, Egypt, Argentina, and the UAE in the alliance. Siluanov suggests that BRICS is focused on diminishing ties with the West and strengthening relationships in the Southeast.
SWIFT, which is primarily owned by banks, plays a crucial role in the global banking system by securely transmitting money-related messages. In March 2022, the organization banned several Russian banks at the request of the European Union. In August of the same year, South Africa’s finance minister mentioned that a BRICS-based payment system would aim to enhance trade in local currencies, rather than relying on the US dollar. However, he acknowledged the challenges of implementing such a system and clarified that it would not directly challenge SWIFT.
In summary, the BRICS alliance is exploring the possibility of launching a global payments system that could bypass SWIFT. The group’s finance ministers will discuss the potential of a unified payments network at their next meeting. This move aligns with BRICS’ objective of reducing dependence on the West and expanding relationships in the Southeast. SWIFT, a key component of the global banking system, faced criticism when it banned several Russian banks. While BRICS aims to strengthen trade in local currencies, it does not intend to directly challenge SWIFT.