Fair Use Act Disclaimer
This site is for educational purposes only!!
**FAIR USE**
Copyright Disclaimer under section 107 of the Copyright Act 1976, allowance is made for “fair use” for purposes such as criticism, comment, news reporting, teaching, scholarship, education and research.
Fair use is a use permitted by copyright statute that might otherwise be infringing.
Non-profit, educational or personal use tips the balance in favor of fair use only
#Russia - #Ukraine conflict is REALLY about the demise of U.S.A Hegemony, Petrodollar ?
#CIPS : Cross-Border Interbank Payment System
#SWIFT : the Society for Worldwide Interbank Financial Telecommunication
CIPS :
The Cross-Border Interbank Payment System (CIPS) is a payment system which offers clearing and settlement services for its participants in cross-border RMB payments and trade. It is a significant financial market infrastructure in China. CIPS is sometimes referred to as the China Interbank Payment System. CIPS was developed in two phases. On 8 October 2015, the first batch of direct participants included 19 Chinese and foreign banks which were set up in mainland China, and 176 indirect participants which cover 6 continents and 47 countries and regions. On 25 March 2016, CIPS signed an MoU with SWIFT with mutual understanding of deploying SWIFT as a secure, efficient and reliable communication channel for CIPS's connection with SWIFT's members, which would provide a network that enables financial institutions worldwide to send and receive information about financial transactions in a secure, standardised and reliable environment.
CIPS would not facilitate funds transfer; rather, it sends payment orders, which must be settled by correspondent accounts that the institutions have with each other. Each financial institution, to exchange banking transactions, must have a banking relationship by either being a bank or affiliating itself with one (or more) so as to enjoy those particular business features.
However, it was reported in July 2015 that CIPS would be '"watered down" and used only for cross-border RMB trade deals rather than including capital-related transactions, which would delay billions of dollars' worth of transactions, including securities purchases and foreign direct investment, that would have gone through the system. It was reported to be a second setback to the plan to provide a unified network for settling deals in RMB after technical problems delayed its launch, and that other measures to open up China's financial infrastructure have been dented by the 2015 Chinese stock market crash. It was said to now offer, at best, a complementary network for settling trade-related deals in the Chinese currency to a current patchwork of Chinese clearing banks around the world.[1]
In response to the 2022 joint decision of Canada, the EU, the UK and the US to ban select Russian banks from the SWIFT payment network as a sanction against the Russian invasion of Ukraine, it was widely suggested that Russian banks might adopt CIPS as an alternative.[2][3][4]
SWIFT:
which stands for the Society for Worldwide Interbank Financial Telecommunication, is an independent enterprise based in Belgium that provides a messaging system linking more than 11,000 banks and financial institutions in over 200 countries and territories. Founded in 1973, SWIFT allows banks to send money to each other. It uses standardized, secure codes that allow institutions to send and receive information, such as instructions for transferring money across borders.
Impact on Russia
"This [barring key Russian banks from SWIFT] will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally," according to the joint statement referenced above.1
Russian financial institutions handle about $46 billion worth of foreign exchange transactions per day, about 80% of which are denominated in U.S. dollars. SWIFT handles 42 million remittances per day, of which Russian financial institutions accounted for 1.5% as of 2020.
:56
:58
34:51
