Russia, in its current negotiations for a truce with Ukraine - reportedly only with the US so far - is requesting to be reconnected to SWIFT, the global financial messaging system used by banks for secure communication of transactions, including letters of credit (L/Cs).

This is a request that Washington on its own cannot grant because SWIFT is not a government-run system. It is Belgian-based cooperative, owned and governed by its member banks.

Moscow's problem

Russian importers and exporters have faced major hurdles in securing trade finance since Russia was partially disconnected from SWIFT starting on 12 March 2022, as part of coordinated Western sanctions following its invasion of Ukraine on 24 February 2022.

Since then western banks and corporates have chosen to avoid doing L/C-based business with Russian counterparts to avoid compliance risk.

Western pressure

While Western governments can pressure SWIFT to disconnect certain countries (as seen when SWIFT cut off some Russian banks in 2022 under EU pressure), the US itself does not control SWIFT.

So, Russia asking the US to help them get reconnected to SWIFT is more a political move than a procedural one - the US would have to persuade the EU and SWIFT's governing board.

Washington's current relations with Europe suggest the EU is unlikely to warm to any request to support the reconnection of Russian banks currently disconnected from the global messaging platform.

This article represents the views of the author and not necessarily those of the ICC or Coastline Solutions.