What is Swift? What does SWIFT stand for - and will Swift banking system be used in sanctions against Russia?

Russia's invasion of Ukraine has seen many countries call for hard hitting economic sanctions.

Many are calling for Russia to be banned from the Swift banking system, including the Labour leader, Keir Starmer and Ukraine’s foreign minister, Dmytro Kuleba who made a passionate plea on Twitter, calling for countries to implement a ban,

Here is everything you need to know about Swift, including what it is and if Swift will be used to sanction Russia.

What is Swift?

Swift is a secure messaging system that banks around the world use to make fast and secure international payments.

In 2020 alone, over 38 million transactions were sent every day on the platform.

What does Swift stand for?

Swift stands for the Society for Worldwide Interbank Financial Telecommunication.

How will Russia be impacted if they are banned from Swift?

Swift plays a key role in Russia's oil and gas industry, with over 11,000 institutions in Russia using it to send payments.

Those in favour of banning Russia from Swift, say it would make it impossible for those institutions to send money and would heavily impact Russia's economy.

Will Swift be included in sanctions against Russia?

There have been calls for Swift to be included in sanctions against Russia, but so far there has been hesitation from some EU countries and the USA.

Ukraine’s foreign minister, Dmytro Kuleba, took to Twitter to share his frustration that including Swift in the sanctions was still even being debated.

Tweeting, 'I will not be diplomatic on this. Everyone who now doubts whether Russia should be banned from Swift has to understand that the blood of innocent Ukrainian men, women and children will be on their hands too. BAN RUSSIA FROM SWIFT.'

Why are some countries reluctant to ban Russia from Swift?

There is a concern that if Russia is banned from the Swift system, it will simply just turn to an alternative system that has no sanctions, such as China's Cips system.

China set up Cips as their alternative to Swift as there is a fear that if Russia is banned from Swift it will simply just switch over and would not be impacted by the sanctions.

More from the News Letter:

Why is Russia invading Ukraine? Simple explanation of Russia Ukraine war - and what this means for the UK

How is the UK responding to the Russia invading Ukraine? And what sanctions have the UK placed on Russia?