news
The goal of the BRICS countries is to introduce a SWIFT-like messaging system.
Russian President Vladimir Putin confirmed in October that the BRICS countries are discussing the use of digital currencies to lessen the influence of the West on fintech. The team is now thinking about developing a platform for digital assets to lessen the need for US dollars in cross-border transactions. President Putin has backed this initiative, emphasising that digital currencies could help other developing economies in addition to the BRICS nations.
According to Putin, the BRICS nations are planning to launch a service tentatively called BRICS Pay, as reported by Crypto Briefing. Brazil, Russia, India, China, South Africa, Iran, Egypt, Ethiopia, and the United Arab Emirates are among the nations that will use this platform.
The platform, which is based on a blockchain network, is anticipated to help the aforementioned countries with cross-border settlements. Financial assets like cryptocurrencies and CBDCs will enable transactions without the need for brokers or middlemen. Additionally, using digital assets for payments can reduce the service fees that payment facilitators typically charge for transactions involving fiat currency.
JUST IN: BRICS to use digital currencies for investment developments. pic.twitter.com/i7u7JFsC55
— BRICS News (@BRICSinfo) October 18, 2024
To enable these digital currency payments, the BRICS nations are also looking to implement a messaging system akin to SWIFT,a secure information-sharing platform used by many financial institutions.
De-dollarization has been a goal of the BRICS group since earlier this year. The development of a potentially decentralised platform has been suggested to the group in order to incorporate digital assets into the current financial systems of the participating economies,according to a March report published by the Russian publication TASS.
Consecutive interest rate increases in the post-COVID-19 era have caused the US dollar to experience considerable volatility in recent years. Since the US has placed numerous sanctions on payments coming from China and Russia, it is especially urgent for these nations to lessen their reliance on the dollar.
From October 22 to 24, the 16th BRICS Summit took place in Kazan, Russia. The issue of navigating the current international payment systems, which the BRICS view as being dominated by the dollar, was reportedly one of the top agendas during the meeting.
Notably, India is working with the G20 countries to create a comprehensive set of international crypto regulations. The RBI and representatives of India’s Ministry of Finance have not yet provided any information regarding the digital asset platform that the BRICS group is currently debating, though.