If Russia is disconnected from the SWIFT interbank system, it will impede bank operation and necessitate the use of outdated technology, but Russian financial institutes and companies are technologically prepared to do this, stated Russian Deputy Prime Minister Arkady Dvorkovich in response to students’ questions during the opening ceremony of the seventh session of the “International Model United Nations” conference.
“Of course it [the disconnection from SWIFT] would not be pleasant, because it would encumber the work of companies and banks, slow this work down, and necessitate the use of outdated information transfer and settlement technology.
Nevertheless, in connection with the fact that this threat has been voiced multiple times, our financial institutes and companies are morally and technologically prepared for it. And so we will meet any problem in an appropriate manner,” Dvorchikov said.
He emphasized that such measures would also harm companies working in the US and in Europe. “On the whole, this would be an insane action by our partners. Of course, it will also harm them - I’m referring not to the specific entities making this decision, but to the companies that operate in the US and Europe. This concerns more than just disconnection from SWIFT,” the deputy prime minister observed.
Russia’s possible disconnection from SWIFT has been discussed since 2014, when the first anti-Russian sanctions were introduced in connection with the situation in Ukraine. The European Parliament adopted a resolution calling for Russia to be excluded from the SWIFT international settlement system. However, SWIFT said that such action would break laws and harm companies.
In 2017, Russian Central Bank head Elvira Nabiullina said during a meeting with President Vladimir Putin that the necessary conditions have been established in Russia for payment systems and banks to function if the country is disconnected from SWIFT. The Bank of Russia has its own financial communication transfer system which was created as an alternative channel for interbank cooperation in order to provide a guaranteed and seamless electronic communication service for financial operations.
SWIFT is the Society for Worldwide Interbank Financial Telecommunication. More than 11,000 financial institutes and 200 countries are connected to it.