What is SWIFT? How Russian banks got cut out of the financial system

Several Russian banks were banned from the SWIFT financial-messaging system following Russia's full-scale invasion of Ukraine. So, what does it mean to lose access to this important part of the international economy, and are there any viable alternatives?
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Effective communication systems are the backbone of how the world stays connected, from mobile phones, email networks, to banks.
What do banks use to communicate?
SWIFT - or the Society for Worldwide International Financial Telecommunications - is a system that banks use to securely send messages to each other. It is one of the key pillars of the financial world, connecting more than 11,000 member banks in some 200 countries and territories globally. Trillions of dollars'-worth of currency are sent across borders every single day - and it's largely thanks to the messages sent by SWIFT.
How does SWIFT work?
If you wish to transfer $1,000 from your bank in Singapore to your friend in the UK, you'll need a few key details; namely your friend's account number and his bank's SWIFT code. If the two banks have an account with each other, they authenticate the payment request, apply an exchange rate and the equivalent amount is deducted from your bank account for your friend to receive.
If the banks don't have a relationship, the message will be sent through intermediary banks, until the payment request is verified for your friend to receive his money.
"It's really about secure, automated payments," Alistair Milne, an economist at Loughborough University told CNBC. "This is so that everything integrates with the bank systems."
What happens if you're banned from SWIFT?
SWIFT has been thrown into the spotlight with the Russian invasion of Ukraine, when numerous Russian and Belarusian banks were removed from the SWIFT network as part of economic sanctions. This essentially means these banks' ability to conduct financial transactions on an international scale has been disrupted.
However, SWIFT is not the only system for international transactions. Russia has its System for Transfer of Financial Messages or SPFS, serving 400 users as of February 2021. Twenty-three of the users were foreign banks.
The People's Bank of China also has the Cross-Border Interbank Payment System, or CIPS. By 2019, it reached more than 3,000 banks directly and indirectly, across 167 countries and regions.
Furthermore, alternative networks like cryptocurrencies and blockchain technologies are advancing.
Caroline Malcolm, who heads international policy at blockchain data company Chainanalysis acknowledges that a legacy system like SWIFT is hard to detach from. "But there are certain capabilities and features in blockchain based systems that can't be matched by traditional systems," she said in an interview with CNBC. "Blockchain allows people to hold their own funds and control that in a very direct way."
Watch the video to find out more about the future of payments.
#CNBC #SWIFT #Blockchain #Crypto
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[@garlicbreathandfarts]

Everything can and usually does get replaced with time.

[@vladimirfasyura8191]

Swift доказало свою ненадёжность и политическую ангажированность

[@Dear_Mr._Isaiah_Deringer]

не могу поделиться своим опытом.

[@spidey5324]

Stupid swift. It needs to be replaced by multiple systems.

[@paurasmore9135]

World needs UPI

[@kalomboC]

The trouble with the weaponization of the Western Financial System is alternative systems become increasingly attractive as countries (even neutral ones) realize their vulnerability. A similar thing has happened at a smaller scale with dollar denominated payment gateways like VISA etc have found themselves replaced by national switches at a local level. The wise countries and regional blocs will start to prepare and implement parallel financial eco-systems and mandate their use by entities wishing to do business in their countries.

[@urrywest]

Needless to say, the theft of countrie's economic assets held in off shore banks, including dollars owed by the US, erodes trust in those institutions as well as the dollar.... The person most responsible for the implementaion of other currncies by contries otside of the 'international community' is Trump and the continuation of his policies by biden will insure that there will be rival mediums of exchage to the dollar world wide. The initial economic respoince to sanctions in russia was the tanking of the ruble.... That was quickly reversed by russia demanding payment in rubles for it's hard comodities. The ruble quickly climbed to it's pre sanction value after that.

[@TheMap1997]

I always feels like the West especially amthe American shot their own feet

[@er.esakkim8781]

Rupay was created especially to reduce the dominance of VISA & Mastercard. Since it's creation, it has successfully replaced over a significant usage of VISA & MasterCard in India.

[@awesomebrotherhood7698]

The financial systems should be neutral and should never be weaponzied although local platforms should exist to keep the country alive if any politicians talk too much. 😉

[@tanmaysingh267]

@@er.esakkim8781 i don't like rupay

[@Sams_Uncle]

Weaponisation of anything is dangerous.

[@Grizzlyx9]

wat do u want? leave putin alone?

[@roshanjain147]

@@Grizzlyx9 ..if you make a reserve currency..a weapon. People will lose confidence and eventually replace dollar..this will cause hyperinflation in us

[@jayeshtransight]

@@Grizzlyx9 you fight with putin now , you may fight with us also in the future .may be you will see some WMDs in our countries too .

[@nickashton3584]

Chinese interbank transfer system CITT already exists

[@tyoong719]

There is clearly a business need for alternative to Swift.

[@dungkicau4155]

If the barrage of sanctions is aimed at punishing Russia for the conflict that caused a humanitarian crisis, then where did the sanctions go when the conflict occurred in the Middle East???? Human reasons often become fairy tales during the day😅

[@pose-x]

China is having a problem Because young pple all over the country refuse to work And it's GDP has dropped dramatically It's so bad the PM is begging them to work

[@kelvinking4022]

It will be replaced. It's just a matter of time

[@andywu8558]

You feel it too right? 🤑🤑🤑

[@B4U_09]

USA and EU - 5500 sanctions Russia - 1 sanction (Rouble) USA and EU- Not fair

[@jamesdickerson1657]

It's not hard to attract banks when the current system completely crashes.

[@albertongoogle]

Intermediary bank process should be investigated. Send first time fee is x, send second time (same details) fee is y. Ask receiving bank about it, they don't know. Ask sending bank about it, they also don't know.

[@max_galingumas9409]

they did not disconnect Gazprom and other banks responsible for trading gas and oil

[@repure1999]

When 1 country controls all the money... It won't last too long.

[@mollyb3401]

"Detached from swift overnight" As Ripple just lays down their terms for settlement. I ❤ it! Simply Beautiful.

[@ramooznola9720]

flip the switch

[@valeriacortez7003]

589

[@rstefan1821]

Detached from swift overnight is a thing that China Russia and I think India are planning and work for it years now. the sanctions against Russia will simply accelerate the implementation of this alternative to SWIFT System

[@SoCat559]

XRP to the moon!!

[@MultiTaranaki]

Facts

[@BushmanCanuck]

🚀

[@supercadet111]

This article glosses over the geopolitical and national security reasons for alternative systems to gain prominence. Nobody ever said SWIFT had to disappear for parallel networks to grow. The Chinese govt also aren't simply going to passively hope that other countries join their system. There are other reasons that countries would like to join the Chinese system as well. Eg. Developing economies lacking large US currency reserves, would be interested in dealing directly in Yuan where possible, and if not threatened by the US Empire 🙄

[@BushmanCanuck]

XRP

[@emilio2647]

Shaun-Paul L I wonder if there will be a global fallout if China is barred from SWIFT?

[@awesomebrotherhood7698]

In the end there are two things, If there is a will, there is a way If you give anyone time; they can find something around it

[@busarachaikham149]

Understand very clear , thank you

[@greendenny4383]

So this is west weapon to sanction and robbery other country, dollar and swift is dangerous thing.

[@kwatai9298]

I hope one day world will be free from this neo-coloni message institution.

[@prasitkoysiripong5150]

Lord Buddha said "Uncertainty is certain" Every thing comes and goes.

[@aninda2457]

Bhagwad Gita also says the same :) and you are right

[@pralinkp3224]

UPI system is all over in india even street vendors can use it . Hope it will replace swift payment so that monopoly can be broken and give way for new beginning

[@alparslankorkmaz2964]

Nice video.

[@simonsayshi]

Ripple has always said they do not intend to replace swift, but help update to current times. Xrp baby

[@frankm4349]

It has to be removed or abandoned as it has been weaponized and politicalize.

[@joem0088]

I am no specialist but it seems that SWIFT is just secured, structured messaging. Funds does not change hands with a SWIFT message. You need to follow it with a complex settlement process (like the CHIPS system) to move funds around and that can only be done when relationships are in place. Without a settlement system SWIFT is useless, and the settlement system is much harder to replace because it's a set of long established financial IT/business processes and contractual relations.

[@johnnydaller]

I was born before SWIFT and we did just fine.

[@draker769]

Back then you don't do much business overseas in the same volume now

[@johnnydaller]

@@draker769 With sanctions, there is not much business to do anyway!

[@mudassarhunzai3789]

Good , lot of knowledge

[@abuahmed6058]

If some banks together can form money transfer system the SWIFT then other banks If they want can have their own payment system .

[@cheryleewilcox3332]

I'm in Venezuela. We are now using the Russian Mir payment system.

[@emilio2647]

Cherylee Wilcox so was Venezuela also banned from using from SWIFT banking?

[@cheryleewilcox3332]

@@emilio2647 Venezuela doesn't depend the SWIFT financial messaging system.

[@chaz2405]

Why dollar?

[@jacobbhattacharjee2820]

Nothing is permanent in this world 😈 your time has come and now Swift will fall

[@Shawoniscreative]

Can we appreciate the afford and times being used to make this extra ordinary beautiful report about SWIFT?🤑 Credit goes to Nessa Anwar,Eli loh, nicky 👇Suryono, Victor Loh, Cristy Garret🖤

[@CNBCi]

Thank you. It means a lot. ❤️

[@MrPanjialam]

SWIFT is not trusted enough since they can steal our money instantly if we have different idea. Better use 2 or 3 SWIFT system like so we can reduce the risk.

[@parler8698]

Are bank accounts still frozen in Canada?

[@AG-cl9no]

RIPPLE & XRP IS GOING TO TAKE OVER ‼️‼️‼️‼️⚠️

[@repure1999]

You'll see other means of wiring money outside of Swift...

[@BipinBabu2024]

What is BRICS payment system?

[@itconsgenio]

Short answer is Yes. Like everything else can be replaced.

[@archit7401]

India's🇮🇳 UPI has a huge potential to be an alternative to SWIFT. It has NO transaction charges (MDR) & can instantly transfer money between banks, e-wallets, merchants & consumers. You are just required to scan a QR code or have the UPI Id of the party involved. It is Simple, secure & hassle free. It is also accepted in developed countries like France, Singapore, Switzerland, Japan, S. Korea & The UK.

[@theshrirangkadam]

Have you ever heard of UPI. If we are talking of block chain as alternative we must also take a look at UPI first.

[@guillermoaguirre]

can't wait to see when all this gets "eaten" by Ripple

[@adrianriley1939]

Me neither brother 🤑🤑🤑

[@marx9694]

NOKIA replaced by IPHONES so ?

[@godzillaleung888]

Swift is a system, hardware, software, operator and data, all system can be replace. System is good when the outhority who control it use it as positive aspect of the members, if malfunction can be repair, if use as political pressure to member soon or later will be collapse and replace with better one.

[@user-pb2mn7go2p]

But quention stays. Will those neutral to it use the system if in reality they don't need to?

[@emilio2647]

Ronny Leung I'll bet the US will also ban China from using SWIFT if they invade Taiwan.

[@ecavero1]

1:53 You just described the Lightning Network! Just replace banks with Lightning Nodes!

[@Rdev845]

UPI will emerge as replacement of Swift. It's growing over 100% 🇮🇳🇮🇳🇮🇳

[@agarwalamit081]

UPI isn't an international transaction system. It is only a national payment method like VISA or MasterCard

[@Rdev845]

@@agarwalamit081 But NPCI is collaborating with Singapore banks to provide UPi service their deadline is July 2022. Nepal, Bhutan and UAE are also in process....Then we can demomstrate UPI can work internationally.

[@mgulled7974]

India is poor country and its agrarian economy is irrelevant

[@izdotcarter]

What countries do you send money to?

[@paulalietke888]

Understand

[@pendletonglobal6028]

yes

[@StPiter111]

It's done😎

[@akihiko99]

UPI

[@The-Celestial]

I recommend you guys should check out the _UPI_ system of India & I guarantee you SWIFT no longer will be needed. Soo seamless & easy to use & transfer you cannot even fathom!

[@bikermaniac6002]

Swift is already been replaced. Eurasia will has its own payment system.

[@Rajuvai317]

Ma'am I am opening account in swift bank but it is not active why ma'a Please help me

[@mdfaisal216]

everything is possible

[@brmahadev4916]

What is seato

[@aniketchauhan2168]

Upi be like hey! 😂

[@CoronaHero]

Russia demands payment in Rupees, checkmate swift! I love the narrator saying, “countries that get out of line…” you mean won’t put up with USA meddling! lmbo Welcome to losing world currency status - just focus on your problems at home and Europe take care of itself

[@JeanGunnhildr88]

They end themselves...

[@freebie808]

END ALL SANCTIONS

[@markdejongh47]

Hello

[@UHaulShorts]

can *oil* b replaced?

[@SPQRafc]

Sure, why not

[@Chandankumar-qw6hb]

🎉🎉🎉

[@peladoclaus]

as always.. the juicy stuff is left out..

[@coshi1894]

The future

[@Barbosas984]

I can see an alternative created by BRICS

[@vhia9096]

Hi alls i need information for send money from moscow to indonesia , givee me knows pleaseee

[@user-fx2oo3bi9c]

SWIFT🇪🇺 CAN EASY REPLACED WITH UPI🇮🇳 SYSTEM . UPI is cheaper,efficient,highly secure and advanced than Swift .

[@mgulled7974]

India is poor country and its agrarian economy is irrelevant

[@ssting]

Any business, users come first

[@akihiko99]

Rupay

[@AG-cl9no]

XRP VALE KZbinR SHOULD BE INTERVIEWED IN THIS CHANNEL

[@m.n9010]

Xrp is the new world swift

[@weipengtan1923]

Need to bypass the bullies.

[@SamOreo7]

In your dreams.

[@kerstingriese6138]

I HAVE INCURRED SO MUCH LOSSES TRADING ON MY OWN...I TRADE WELL ON DEMO BUT I THINK THE REAL MARKET IS MANIPULATED... CAN ANYONE HELP ME OUT OR AT LEAST TELL ME WHAT I'M DOING WRONG!

[@Rajuvai317]

I am unable to withdraw money from my SWIFT account Help me please 🙏🙏

[@galupas]

It already has been.

[@adityashankert]

I never used banks for sending money it’s worst way to send money… apps are better

[@keithleyjarvis5663]

This video makes it seems like swift is an all powerful system 🤦🏽‍♂️🤦🏽‍♂️🤦🏽‍♂️ there Way's around Swift they Just take longer to

[@KennyL1]

Cryptos are very volatile. You wouldn't want to send large amount of money using Cryptos. Central Bank Digital Currency will be the way forward using electronic Blockchain exchange setup by a consortium of central banks and the Bank of International Settlement. This will be parallel to Swift. Trial is being held in Singapore.

[@urbexmediafilm]

stable coins my fren

[@eastern2western]

Russia is not officially out of swift because eu is still doing business with russia through certai russian banks.

[@dandanfree2925]

Anything can be replace.....how long does it takes ? Russian system works in russia ONLY and Chinese system works in China only.It is good that sanction are destructives now so autocracies & dictators can still park their cash somewhere but it is not businness as usual. Cutting the cash flow is the only thing that works in the loong run without fighting wars.

[@mohamedabdukadir3271]

No, I used Hawala😂, Russia Somalia can help you with the SWIFT problem

[@paurasmore9135]

Tom needs UPi.

[@irhanespratama]

Ripple

[@jessicacrawford3234]

XRP will take over swift dsoon. ISO2022 will be here in November and Riplle is a front runner on that list.

[@noeeeone]

Corda r3 ripple could replce swift

[@shobadasari5363]

How does this affect the common citizen especially,if you have a corrupt political system.Will our lives change for the better ? Will we be left to mow lawns.

[@user-pb2mn7go2p]

Well, you can't send money abroad* or receive them in any legitimate way. *Countries whose banks use only SWIFT

[@user-pb2mn7go2p]

So I can't send money to Europe and nobody can send money to me. Also you can't pay in Russia with your foreign bank's VISA/Mastercard card now. So you need cash then get a local bank card and then you can deposit and pay with that local card in the country.

[@MeiinUK]

​@@user-pb2mn7go2p: It means that there would be normal currency.... And then another layer of electronic tokens that makes it to a ratio on top. That is what is like to happen. It's a form of debasing as well ? But it's weird that a lot of millennials are seeing it as money. It's basically a form of prepaid. Cos the way that the crpyto is structured isn't more than an actual mlm at the moment.

[@apb5866]

They are talking as if use blockchains and CBDC are far off into future. LOL

[@coshi1894]

Cardano

[@francislau3393]

A bank that robs bank

[@cemeter1832]

Ripple > Swift

[@jk2435]

India has UPI...it's new and spreading rapidly

[@eyeswideopen6492]

roll on mid to late 2023 when ripple will more than challenge this archaic system and XRP will explode and make me a millionaire..

[@softwareyhardwarefusion]

No problem, SPFS Payment system and CIPS from China is better, all countries into BRICS will use this system.

[@Buttersausage]

The all powerful American DOLLAR

[@sachin2842]

UPI India 🇮🇳☺️♥️

[@CGV.69]

XRP 🚀🚀🚀

[@moonnightgodofegypt4998]

Banker's think not politician s

[@jamesd5931]

XRP goes live November which will faze out swift within 5 years

[@freebie808]

A cartel

[@kanundash]

589

[@adrianriley1939]

A very important number XRP>589

[@Nejineto]

Obviously it’s an antiquated technology. It is slow as shit for the digital age. XRP is the future bridge currency for all fiat. It’s simply a matter of time.

[@user-km2ei4vz3v]

Nooo ... Indian UPI system is much more efficient and quicker ....