How SWIFT is Spurring Demise of Dollar

Date: 02 May 2025 - 22:42

News ID: ۱۳۹۱۱۰

WASHINGTON (The Cradle) -- The weaponization of global finance has become a cornerstone of U.S. foreign policy. Central to this has been Washington’s control over the Society for Worldwide Interbank Financial Telecommunication (SWIFT), a financial messaging service once considered a neutral platform but now openly used to enforce western sanctions and isolate adversaries.
While U.S. President Donald Trump threatened economic punishment for countries that ditched the dollar, his own first 100 days in office saw the steepest decline in the currency since the Nixon era. That symbolic moment coincided with a global shift already underway: an accelerating effort by nations to reduce their dependence on U.S.-controlled financial infrastructure.
Today, an expanding coalition of states – some sanctioned, others simply cautious – is turning away from the U.S. dollar and the SWIFT network, embracing new financial systems that promise to operate beyond Washington’s reach.
SWIFT is not a bank or a payment processor; it is a messaging platform that allows financial institutions to send secure transaction instructions across borders. Its core appeal lies in its speed, encryption, and near-universal adoption and standardization. Banks in different countries, operating in different languages and currencies, have long relied on it to do business seamlessly.
That image took a hit in 2006, when it was revealed that SWIFT had quietly provided transaction data to the CIA and U.S. Treasury as part of the Terrorist Finance Tracking Program (TFTP). That surveillance continues, with the U.S. National Security Agency (NSA) monitoring SWIFT messages today.
Then came 2012, when bipartisan hawks from United Against Nuclear Iran (UANI) pressured SWIFT to cut ties with Tehran, accusing the country of violating both U.S. and EU sanctions. SWIFT quickly complied. Yet when Palestinian activists demanded the same be done to Israel over war crimes, the campaign was ignored. With the precedent set, SWIFT booted out North Korea in 2017 and Russia in 2022.
The message was clear: SWIFT was no longer neutral. It was a tool of economic warfare.
Being cut off from SWIFT can cripple an economy overnight. Banks become isolated, unable to send or receive payments even with non-western partners. Trade seizes up. But the tactic is proving self-defeating.
After the West threatened to disconnect it following the 2014 Crimea annexation, Russia developed its own platform: the System for Transfer of Financial Messages (SPFS), launched in 2017. Today, SPFS includes 177 foreign institutions from 25 countries.
Iran, which announced in 2023 that it had begun integrating interbank communication and transfer systems with Russia, is working on its own financial messaging infrastructure, known as Automated Currency Management and Exchange Reporting (ACUMER).
But the biggest challenge to SWIFT is not from sanctioned states – it is from rising powers anticipating future U.S. hostility.
China launched the Cross-Border Interbank Payment System (CIPS) in 2015. While it still uses SWIFT for many transactions, CIPS has its own messaging layer, enabling seamless trade with Russia and other partners. Nearly 4,800 banks now participate in CIPS – about half of SWIFT’s total, despite being less than a decade old.
Recognizing the need for a unified, cross-border alternative, the BRICS bloc began developing “BRICS Pay” in 2018. With the bloc now surpassing the G7 in economic

size, BRICS countries make up over a third of the world’s economy. BRICS Pay began pilot payments in 2019 and received full backing from China in October 2024. While still in its pilot stage, its potential scale makes it SWIFT’s most serious rival yet.
But the move away from SWIFT is no longer confined to America’s adversaries.
In 2022, the Association of Southeast Asian Nations (ASEAN) – a bloc of 10 largely US-friendly states consisting of 600 million people – launched the Regional Payment Connectivity (RPC) initiative. It leverages national real-time payment systems like Singapore’s PayNow and Thailand’s PromptPay to enable direct transfers without relying on SWIFT.
Previously, cross-border transactions between ASEAN states required conversion into and out of U.S. dollars. For instance, if someone sends money from Singapore to the Philippines, the Singapore dollars would be converted into American dollars, and then the American dollars would be converted into Philippine pesos. With RPC, such conversions are bypassed, reducing costs and boosting efficiency.
That same year, the African Union launched the Pan-African Payment and Settlement System (PAPSS), which also skips SWIFT and the dollar intermediary.
This quiet revolution among Washington’s partners signals a deeper shift: even allies are wary of SWIFT’s politicization.
Despite this trend, SWIFT is not disappearing tomorrow. Many institutions use it in tandem with alternatives to maximize market access. But the spread of new messaging systems gives countries unprecedented options to assert economic sovereignty.
In 2012, Iran had to rely on bartering and gold shipment to bypass sanctions. Today, it can trade with China via CIPS and with Russia via SPFS. As more states adopt similar systems, the impact of any future SWIFT bans is significantly reduced.
That undermines SWIFT’s key selling points. Security? Damaged by U.S. surveillance and the 2016 Bangladesh Bank hack, which saw $81 million stolen. Speed? Eclipsed by real-time systems like RPC and PAPSS. Universality? Fading with each country expelled from the network.
SWIFT’s real strength lies in its network effect: It works because everyone uses it. But with each politically motivated disconnection, that network shrinks. In contrast, China’s CIPS has no history of broad sanctions, making it a safer bet for states seeking financial stability.
The decline of SWIFT goes hand in hand with the weakening of the U.S. dollar’s global role. Since SWIFT serves as a gatekeeper, Washington can punish any country that tries to ditch the dollar in its trades. But once alternative systems remove that leverage, countries can explore other trading currencies. Moreover, real-time platforms like RPC reduce dependence on intermediary currencies altogether.
China and Saudi Arabia are now exploring renminbi-based trade. That shift would have been unthinkable in the dollar-dominated era of SWIFT’s peak.
Of course, U.S. financial supremacy will not vanish overnight. But the rapid rise of parallel messaging systems shows that global powers – both adversarial and allied – are charting paths out of the west’s financial orbit.