Russia pushes plans for digital ruble to replace SWIFT

The Central Bank of Russia (CBR) has revealed that it plans for the digital ruble to be a replacement for the financial messaging system SWIFT. According to Olga Skorobogatova, first deputy chairman of the CBR, when the platform is fully ready, Russia will no longer need SWIFT. 

Skorobogatova shared this in an interview with the state-owned news agency TASS where she talked extensively about issues in the Russian financial system. She made the remark while commenting on why the CBR is putting so much effort into the CBDC project. 

“We realized that we need to move very quickly in terms of digital technology and innovation development… Plus, this also solves the issue of disconnecting from SWIFT, because with such integration, SWIFT will no longer be needed,” she said, according to the interview transcript published on the CBR website. 

The deputy governor also reaffirmed that the CBR is accelerating the CBDC pilot project to meet with an April 2023 pilot launch of real value transactions. At the time of writing, 12 banks are part of the pilot and are at different stages of implementation, with another three looking to join the effort.

She added that the time horizon for a fully fleshed out and functioning digital ruble is an estimated three years.  

Russia’s plan for international CBDC collaboration 

Meanwhile, with the digital ruble replacing SWIFT in Russia, the CBR expects that countries still open to doing business with it will also catch up in their CBDC development. Notably, Russia’s allies, including China and India, are also advancing with their CBDC platform development. 

The CBR has already talked about integrating the digital ruble system with support for the digital yuan, which is at an advanced level of development already. Skorobogatova says that Russia will be patient with other countries to catch up as, with time, it will become clearer who it can collaborate with. 

The CBDC is not the only option Russia is considering to use in facilitating cross-border settlements. In a recent statement, the CBR governor noted that digital currencies could be used for international settlements. 

Since declaring war on Ukraine, Russia has been the target of many international sanctions, one of which was its restriction from using SWIFT. The sanctions have not abated, as have the resolve of the countries sanctioning them. 

According to a report by Fortune, Mairead McGuinness, the European commissioner for financial services, has renewed calls for the EU to pass regulations that will make more sanctions on Russia possible. These sanctions are especially related to Russia’s use of digital assets to evade sanctions.

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