Russia, Iran consider adopting financial payment system beyond SWIFT

Russia and Iran are considering the possibility of recognising the Russian payment system for electronic fund transfers MIR, as an alternative to the global Society for Worldwide Interbank Financial Telecommunication (SWIFT) network, the Iranian ambassador to Moscow said on Thursday.

“We are making efforts in this direction in order to implement good steps in this field in the future,” Kazem Jalali said.

Jalali explained that he had discussed the issue of recognising the MIR payment system with Russian officials.

In 2017, the Central Bank of Russia established the MIR system, following the imposition of international sanctions on the country which started in 2014.

READ: Iran asks for clarification from Russia on US ‘guarantee’

The Central Bank of Russia has also developed a domestic financial-communications platform, the System for Transfer of Financial Messages, SPFS.

The Central Bank of Russia said in 2020 about two million financial correspondences, or about one-fifth of the Russian internal financial messaging traffic, were handled using Russian systems with the aim of raising the percentage to 30 per cent in 2023.

On 3 March, the European Union’s Official Gazette reported that the European Union had removed seven Russian banks from the SWIFT messaging system that supports global transactions as part of its sanctions against Russia for its invasion of Ukraine.

Previously, US sanctions targeted a number of Russian banks, including Sberbank and VTB banks which handle about 80 per cent of all bank balances in Russia.