Russian Lawmakers Consider It Necessary to Create SWIFT-Like System for BRICS Financial Transactions

17:10, 25 July 2024

Muhammad Nooh Osman

Writer/Editor

The movement to use national currencies in mutual trade has gained momentum in recent years. Many countries are seeking to reduce their dependence on the US dollar and other Western currencies, as well as Western-dominated financial institutions. Key players include the BRICS nations, with Russia leading the effort in response to Western sanctions.

Sputnik

The creation of a new system for financial transactions will help build a new economic reality for BRICS countries and their partners, said Alexander Babakov, Deputy Speaker of the Russian State Duma (lower house of parliament), at a meeting on the development and support of comprehensive partnerships with African countries.

According to him, Western banks and funds will not finance the development of Africa that could take the continent out of neocolonial control – such development requires a number of institutions, in particular a bank focused both on investment and clearing.

"On the BRICS financial agenda, we have a major, central initiative for building a new economic reality that solves two super-objectives: the creation of our own financial messaging system for BRICS countries, similar to SWIFT, with reliance on state-owned banks capable of performing clearing in the settlements of counterparties from BRICS countries. And the related role of the same bank," he noted.

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Babakov noted that the development of a BRICS financial messaging system would allow reducing the bloc members' dependence on Western financial institutions and increasing national financial autonomy.

"The new technical system should be compatible with the existing financial infrastructures of the participating countries. This includes integration with national payment systems, banks, and other financial institutions. At the same time, the system should provide a high level of security and data protection to prevent cyberattacks and unauthorized access to financial information," he believes.

In addition, the creation of such a system will lead to an increase in economic efficiency by reducing transaction costs and speeding up transactions themselves, the lawmaker noted.