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Rumors are circulating that they want to exclude Russian banks from the SWIFT system as part of the harsh Western sanctions on Russia.
First of all, what is SWIFT ?
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The Society for Worldwide Interbank Financial Telecommunication, or SWIFT, is a system for global interbank financial communication, enabling the exchange of information on financial transactions between financial institutions worldwide, providing a secure, standardized and reliable environment.
Banks know each other about the transactions that take place.
Background
Recently there was an unexpected upheaval, the Russian Ministry of Finance had submitted a draft law on Bitcoin against the central bank of Russia which proposed a complete ban on Bitcoin.
One reason for the Russian ministry's favorable stance is that there have long been rumors that the West could oust Russia from SWIFT, effectively ousting Russia from an entire system of dollar payments.
In such a case the payment alternatives are minimal, one of them will of course be Bitcoin.
Recently , the Prime Minister of the United Kingdom pushed "very hard" for Russia to be expelled from the international payment system Swift, "a move that would deal a heavy blow to Russia's banks and its ability to trade with the international banking system."
"The prime minister is very willing to push very hard," said a British official, referring to efforts to oust Russia from Swift.
A similar call to expel Russia from SWIFT was made by the Minister of Foreign Affairs of Ukraine: All those who still doubt whether Russia should be expelled from SWIFT must understand that the blood of innocent Ukrainian men, women and children will be in their hands "
Germany does not want Russia to leave SWIFT
. However, there was another shocking upheaval, the German chancellor said. the context of sanctions ".
The British proposal is merely hypocritical, as the British admit that any move on the Swift system could only be made by international agreement, a position shared by the Biden government.
"We have to do it together," said a British official.
Echoing the German position, the US has so far suggested that it was too early to consider such a move.
Daleep Singh, the White House deputy national security adviser, said earlier this week that "there are other tough measures we can take."
Russia's removal from Swift would be a severe blow to its larger banks and would impede Russia's ability to trade outside its borders.
It would also hinder Russia's ability to recoup international profits from its oil and gas exports, which account for more than 40% of its revenues.
Swift, a cooperative, is used by more than 11,000 banks and financial institutions around the world and manages 42 million messages a day, facilitating trillions of dollars worth of transactions.
Russia accounted for 1.5% of transactions in 2020.
The cut by Swift would not prevent Russian banks from conducting cross-border transactions, but it would make these transactions more costly.
Foreign trade would be based on the use of less effective communication tools, such as e-mail.
Europe, meanwhile, remains divided on how to respond to Russia:
The EU is trapped in debates about how to approach the issue.
While the Baltic states and Poland are among those who support an offensive line on the issue, other member states are more cautious.
In other words, even a full-scale invasion of Ukraine will not be enough for the West to make the tough choice of seceding Russia for the simple reason that Europe remains painfully dependent on and interconnected with European energy supply, so Russia can not leave payment systems.