Russia, China should limit SWIFT in transactions – expert

Russia and China need to reduce their reliance on the SWIFT system for interbank transactions to enhance security, according to Yulia Kapranova, executive director of the Russian-Chinese Committee for Friendship, Peace, and Development.

Speaking at the round table on “Financial Transactions Between Russia and China: Current Status and Prospects,” Kapranova emphasised the need to shift to the China International Payments System (CIPS) and the Russian Financial Messaging System (SPFS) for mutual settlements.

Kapranova noted the absence of an IT gateway connecting CIPS and SPFS, currently necessitating the use of SWIFT or custom banking software for transactions.

Despite this, China is promoting the internationalisation of CIPS, bringing in major American and European banks as shareholders, which, while making the system appear international, keeps it a vital part of China’s infrastructure.

Kapranova highlighted the potential benefits of Chinese banks joining the Russian SPFS, which would facilitate financial message transmission exclusively through the Russian system.

This move would eliminate foreign observer access and reduce the risk of sanctions from Western entities, enhancing transaction security between the two nations.

Attribution: TASS.