Explainer | How the West could use Swift finance system to punish Russia for Ukraine attack
- US and European leaders are considering cutting Russia off from the network, which would cripple its ability to trade with most of the world
- But such a move could also spur Moscow to accelerate the development of an alternative transfer system, with China for example
An exclusion from Swift, a very discreet but important cog in the machinery of international finance, is one of the most disruptive of the possible sanctions that the West could deploy against Russia for its invasion of Ukraine.
Ukrainian President Volodymyr Zelensky called Thursday for such a move after Russian forces invaded his country, as Western powers consider imposing additional sanctions on Moscow.
The White House has pointedly refused in recent weeks to exclude the possibility of barring Russia from the international system that banks use to transfer money, a move that would cripple Russia’s ability to trade with most of the world.
European leaders discussed the measure as one possible option at their emergency summit on Thursday. Asked about Swift earlier, German Chancellor Olaf Scholz said: “We need to keep sanctions ready for later times.”
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British PM Boris Johnson calls Putin a ‘dictator’ and warns of ‘massive’ sanctions from the West
What is Swift?
Founded in 1973, the Society for Worldwide Interbank Financial Telecommunication, or Swift, actually does not handle any transfers of funds itself.