Russia is internally using SPFS system, developed after threat of cutting it off from SWIFT system in 2015
The West’s announcement about cutting off Russian major banks from the SWIFT payment system is an opportunity for both India and China to deploy their indigenous systems they had prepared for such an eventuality.
A parliamentary committee has also noted that SWIFT’s privacy is compromised and, before the crisis blew up, had advised the government to improve the existing SFMS (Structured Financial Messaging Solution) for intra-bank message transfer or develop a new one.
North Korea and Iran are the other countries that have already been cut off from SWIFT. Russia is internally using the SPFS system, developed after the West threatened to cut it off from the SWIFT system in 2015. For international financial information flow, China will also be planning to use the CIPS system which is its cross-border payment system in its local currency.
While the credit in rupee or ruble can accrue, sources said New Delhi’s endeavour would be to keep the slate clean by encouraging Russia to import more Indian goods whose other sources might have been blocked due to the US-led sanctions. —
