US Dollar's Downfall: How BRICS Aims to Replace SWIFT

BRICS is looking to create a new payment system for cross-border transactions without incorporating the US dollar in the mechanism. The payment system will embody local currencies for trade settlements and end reliance on the US dollar. The new payment mechanism is termed ‘BRICS Bridge’ and is looking to replace the US SWIFT system and cut ties with the dollar.

The ‘BRICS Bridge’ is Russia’s idea and the Putin administration will discuss the prospects and development with the other member countries. The concept will most likely be addressed in the upcoming summit in October this year which is held in the Kazan region of Russia.

BRICS Bridge To Challenge SWIFT & the US Dollar

The payment system will be a standalone mechanism with mutual currencies being traded for settlements among member nations. The US dollar will find no place in the ‘BRICS Bridge’ and will look to challenge the Western SWIFT system. Read here to know how many sectors in the US will be affected if BRICS ditches the dollar for trade.

“The creation of the independent financial payment platform BRICS Bridge, a standalone mutual payment system on a firm joint platform, is now being discussed within BRICS,” said Russia’s Federation Council Speaker Valentina Matviyenko.

Matviyenko confirmed that Russia’s Central Bank and the finance ministry agree on the development of a BRICS Bridge payment system. “I have spoken both with the central bank and the finance ministry. Things are moving along nicely. It is being discussed with colleagues from central banks, finance ministries of all BRICS countries, including new members,” said Matviyenko.

However, other members are yet to agree on the development of the BRICS Bridge to counter SWIFT and the US dollar. Moreover, the Russian idea of de-dollarization could be the most discussed topic at the 16th summit in October this year.

This article originally appeared on Watcher.Guru