Digital Currencies May Make SWIFT Redundant, Says Russian Central Bank: Report

Digital currencies may challenge and someday could make redundant the SWIFT global banking payment system, according to a Central Bank of Russia official, Russia Today reported.

• Given the pace of development of central bank currencies, several countries may launch one in the next five to seven years, according to First Deputy Governor Olga Skorobogatova, RT reported.
• “Then we can deal with direct integration issues. In this case SWIFT it may not be necessary, because it will be a different kind of technological interaction,” Skorobogatova said at a meeting last week, RT reported.
• SWIFT is a messaging network that banks and other financial institutions use to securely transmit information and instructions via codes. It enables cross-border payments along with other services between more than 10,000 financial institutions in countries around the world.
• Skorobogatova also said SWIFT could wind up being one of the platforms the new central bank currencies use.
• Russia would likely welcome replacements for SWIFT as the nation's banks have been threatened with being removed from the network as part of broader sanctions against the country and the CBR has been working on its own messaging system.

Read more: Bank of Russia Chair: Digital Ruble Is No Threat to Banks