Russia Wants BRICS To Integrate Payments Systems

April 12, 2022
Back
Russia has called on the fellow BRICS countries — Brazil, Russia, India, China and South Africa — to extend the use of national currencies and integrate payment systems.

Russia has called on the fellow BRICS countries — Brazil, Russia, India, China and South Africa — to extend the use of national currencies and integrate payment systems.

Sanctions on Russia, which have come in increasingly tough packages, have cut the country off from the global financial system, as well as from nearly half of its gold and foreign exchange reserves.

On Friday (April 8), Anton Siluanov, the country’s finance minister, told a ministerial meeting with BRICS countries that the global economic situation had worsened substantially due to these sanctions.

The new sanctions also destroy the foundation of the existing international monetary and financial system based on the US dollar, Siluanov said.

According to the Russian minister, there is a need for BRICS countries to speed up their work in a number of key areas, such as the use of national currencies for export-import operations, the integration of payment systems and cards, a financial messaging system, and the creation of an independent BRICS rating agency.

This comes after Mastercard and Visa suspended operations in the country in early March, and some of Russia’s largest banks, including VTB Bank and Promsvyazbank, have been locked out of using the global SWIFT messaging system.

Russia already has its own card payment system, called Mir, which launched in 2015.

It additionally has its own bank messaging system, SPFS, which was developed in 2014 by the country’s central bank, following US threats to cut off the country from SWIFT after the annexation of parts of Ukraine.

At a previous meeting of BRICS countries in 2015, Russian deputy foreign minister Sergei Ryabkov told finance ministers in attendance that they were in the process of negotiating, setting up payment systems and moving on to settlements in national currencies.

“SWIFT or not, in any case, we’re talking about a global multilateral payment system that would provide greater independence, would create a definite guarantee for BRICS,” he said at the time.

Siluanov has not confirmed whether his fellow BRICS members agreed with his position at the meeting, although the countries have said they will cooperate in efforts to fix current financial instability.

BRICS countries, which began meeting formally in 2009, have remained neutral on the matter of Russia’s invasion of Ukraine. All countries abstained from voting for the successful UN resolution to kick Russia out of the UN’s Human Rights Council.

In a previous UN vote on aid support, the bloc had been divided, with Brazil voting for the resolution, which was critical of Russia, while the other countries opted to abstain.

The next meeting of finance ministers and central bank governors of the BRICS countries will be held in June this year, following which a joint statement will be adopted, according to the Russian government.

Our premium content is available to users of our services.

To view articles, please Log-in to your account, or sign up today for full access:

Opt in to hear about webinars, events, industry and product news

To find out more about Vixio, contact us today
No items found.