According to the Iranian newspaper Kayhan, in an unexpected move, Pakistan, India, and several other countries have established the Asian Clearing Union (ACU), a group of nine central banks. The ACU plans to launch a new cross-border financial messaging system in June, as an alternative to SWIFT.
According to a report published in RT, deputy governor of the Central Bank of Iran, Mohsen Karimi, reportedly stated that the new payment system has the potential to completely replace SWIFT and could support the global de-dollarization effort.
The report indicates that initially, the financial system will only be utilized by ACU member states. However, other countries, including those under sanctions like Syria, may apply for membership. Belarus and Mauritius have reportedly expressed interest in joining the union.
During the ACU meeting in Tehran, Mohammad Reza Farzin, the governor of the Central Bank of Iran, claimed that moving away from the US dollar would safeguard the foreign exchange reserves of member states while still facilitating effective settlement of bilateral trade agreements.
Recently, Iran’s economy minister revealed that less than 10% of the country’s international trade is conducted using the US dollar, down from 30% two years ago.
In a separate development, Russia established its own national payment system when it faced US sanctions in 2014. Last year, in response to further sanctions imposed on Russia due to its military actions in Ukraine, which included blocking many Russian banks from SWIFT, the Russian government began promoting the domestic system as a reliable alternative. Russia’s SPFS (System for Transfer of Financial Messages) ensures the secure transfer of financial messages between banks within and outside the country. As per the Russian Central Bank, the system currently has 469 participants, including 115 foreign entities from 14 countries.