In recent hours, voices from the European Union and the United States have increased to further strengthen sanctions against Russia, due to its military intervention in Ukraine.
After blocking assets for Putin, Lavrov and many other officials, closing airspace or even sanctioning Russia's largest banks, the West is agreeing to exclude Russia from SWIFT. But what is it?
SWIFT (World Financial Interbank Telecommunication Company) is a secure communication platform used by banks, bank intermediaries and financial institutions to send and receive information, such as instructions for transferring money abroad or trading securities.
It was founded in 1973 to replace telex and is now used by over 11,000 financial institutions to send secure messages and payment orders. Without any globally accepted alternative, it is an essential plumber for global finance.
SWIFT Corporation is owned by member banks and has a board of 25 members. Its headquarters are in Belgium. It is overseen by a group of central banks known as the G10.
What does the removal of Russia from SWIFT mean?
Russia's removal from SWIFT would make it almost impossible for financial institutions to send money in or out of the country, causing a sudden shock to Russian companies and their foreign clients, especially buyers of oil and gas exports in US dollars.
Russia would face major economic difficulties for a period of time, especially with payments abroad, until it adapts to the new platforms.
