Things start to escalate in this war as UK Prime Minister stated that Russian banks will be cut out from Swift. This is a very huge move and it’s hard to tell what will happen next from here on out.
Excluding Russia from Swift which is pivotal to the international payment system means that Russians will not be able to do business with the west in a smooth and efficient manner. Boris Johnson stated on his Twitter account,
“We have taken decisive action tonight with our international partners to shut Russia out of the global financial system, including the important first step of ejecting Russian banks from SWIFT,”.
Will Russia cut off energy to Europe? How will they settle payments in the short term with outsiders who are within that system? It is to be noted that Russia was developing its own system in order to settle payments.
China too who is probably saving Russia right now has been developing its own system. It’s unpredictable but let’s see how this plays out as the geopolitical pieces are being shifted around and the world is being reshaped.
It is to be noted that this move will not impact all the banks of Russia, it will only affect several banks that were already sanctioned. There is the assumption that Russia has been planning for this for a long time, but the world is so complex that planning is sometimes not enough.
War is not good for any country as civilians’ lives are being lost. Hopefully, there could be some resolve as early as possible.
