- The European Union, led by France and Germany, is considering a new sanctions package that would target foreign banks using Russia’s SWIFT alternative, the System for Transfer of Financial Messages (SPFS).
- This strategy represents a significant escalation, moving from targeting Russian entities directly to pursuing third-party financial institutions that help Russia evade existing economic restrictions.
- The urgency for this action is driven by the rapid growth of SPFS, which reportedly has 177 foreign entities across 24 countries connected to it, creating a parallel financial network outside of Western control.
- The move is a direct response to nations like India, which is reportedly in discussions to adopt SPFS, a choice that would completely exclude Western powers from oversight of India-Russia trade.
- This high-risk strategy acknowledges a broader financial decoupling and could potentially fracture the global financial system into competing blocs, accelerating the de-dollarization trend.
In a significant escalation of the financial war accompanying the conflict in Ukraine, the European Union is considering imposing sanctions on foreign banks that utilize Russia’s alternative to the SWIFT banking system. This move, spearheaded by France and Germany, represents a direct attempt to cripple a key workaround Moscow has used to evade Western economic pressure. The proposal, part of a forthcoming 19th package of sanctions, aims to strike at the very architecture of Russia’s international trade by threatening to cut off any non-Russian financial institution that connects to the System for Transfer of Financial Messages (SPFS).
The birth of a rival system
The context for this drastic measure lies in the unprecedented sanctions levied against Russia in 2022. In response to the full-scale invasion of Ukraine, Western nations took the dramatic step of disconnecting numerous Russian financial institutions from SWIFT. This system is the fundamental plumbing of global finance; it is a secure messaging network that allows banks to send and receive information about cross-border payments, such as money transfers and transaction confirmations. Being cut off was akin to being removed from the global financial internet, severely restricting Russia’s ability to conduct international business. (Related: GOODBYE, WEST: India considers using Russia’s SWIFT alternative for trade settlements.)
In response, Russia turned to its own homemade solution, the SPFS. Much like SWIFT, SPFS is a messaging system that facilitates communication between banks to complete financial transactions. Initially developed in 2014 as a contingency plan after earlier sanctions, it was rapidly expanded after the 2022 SWIFT cut-off. The Russian government has since aggressively promoted it to international partners as a reliable and sanctions-proof alternative for trade with Moscow.
The sanctions strategy deepens
The new EU proposal, championed by its two most powerful continental members, France and Germany, signals a strategic shift from targeting Russian entities directly to pursuing third-party nations and their financial institutions. The argument from Paris and Berlin is that previous sanctions have not gone far enough. They assert that new measures must strike at the deeper structures of Russia’s financial and logistics networks to truly impact its war-making capabilities. This means going after the channels Russia uses to bypass restrictions.
The global reach of SPFS
The urgency behind the EU’s consideration is underscored by the rapid growth of the SPFS network. According to the Russian central bank, as of early 2025, 177 foreign entities across 24 countries were connected to the system. This growth is a tangible metric of the Kremlin’s success in building a parallel financial ecosystem outside of Western control. Nations interested in maintaining trade with Russia, particularly for crucial commodities like oil and weapons components, have found SPFS to be an indispensable tool.
“Russia’s SPFS is an alternative payment system developed by Russia. It was created to provide a domestic alternative to other international financial networks,” Brighteon.AI‘s Enoch explained. “The system already includes a significant number of participants, specifically over 500. These participants consist of large Russian companies and financial institutions. Its development is part of a broader move away from systems like SWIFT.”
A broader financial decoupling
The battle over SPFS is merely one front in a larger economic conflict. Moscow has accelerated a broader push away from Western financial dominance by increasingly insisting on trading with international partners in their national currencies instead of the U.S. dollar or euro. This trend is strongly supported by other BRICS members, including Brazil, China and South Africa, who are also seeking to reduce their dependency on Western-controlled financial systems.
Russia has consistently denounced Western sanctions as illegal and counterproductive, arguing that they have failed to isolate its economy as intended. Instead, Moscow claims the sanctions have backfired, accelerating the decline of the dollar’s dominance and forcing the creation of new, competing financial networks that ultimately diminish Western influence. The EU’s potential move to sanction SPFS users is an admission that this decoupling is real and poses a long-term threat to the existing financial order.
The high stakes of financial warfare
The EU’s deliberation to sanction foreign banks using SPFS marks a critical juncture in the economic war against Russia. It is a high-risk strategy that could potentially fracture the global financial system into competing blocs. While intended to close loopholes and increase pressure on Moscow, it also risks alienating non-aligned nations and accelerating the very de-dollarization trend the West fears. The coming weeks will reveal whether the European Union decides to pull this powerful lever, a move that would redefine the boundaries of financial sovereignty and sanctions enforcement for years to come.
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Watch this video that talks about Europe committing economic suicide.
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Sources include:
RT.com
KenyaStar.com
Euractive.com
Brighteon.ai
Brighteon.com
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