The Asian Banker Wednesday, 24 July 2024

Iran to reconnect to SWIFT banking system soon: Official

5 min read

An Iranian official says the country will reconnect to SWIFT, the global provider of secure financial messaging services, by the end of January.

Head of Iran Chamber of Commerce Mohsen Jalalpour told reporters in Tehran on Sunday that today Iran will re-apply to join the Society for Worldwide Interbank Financial Telecommunication (SWIFT).

Jalalpour said the SWIFT committee will examine Iranian application in a matter of two weeks and it is expected that sanctioned Iranian banks will reconnect to the system by January 30 at the latest, IRNA reported.

In an update on its website on January 17, SWIFT said the European Union has announced that the Implementing Legislation has taken effect. SWIFT has informed the relevant stakeholders about the necessary measures that need to be put in place to make it possible for those banks that are delisted by the Implementing Regulation to reconnect to SWIFT. As previously stated, those banks that are delisted by the Implementing Regulation will now automatically be able to reconnect to SWIFT, following the completion of our normal connection process (i.e. administrative and systems checks, connectivity and technical arrangements).

The announcement follows Saturday’s implementation of Iran’s nuclear agreement, where the EU, the United Nations and the United States lifted sanctions on the country in exchange for curbs on its nuclear activities.

Based on an agreement reached in July between Iran and the P5+1 countries, permanent UN Security Council members and Germany, all economic and financial sanctions against Iran were slated for removal.

The Central Bank of Iran (CBI) said back then that the country’s state-run banks would soon rejoin SWIFT.

SWIFT is a global supplier of secure messaging services, which is used by nearly every bank around the world to send payment messages that lead to the transfer of money across international borders. It operates service transmitting letters of credit, payments and securities transactions among 9,700 banks in 209 countries.

In early 2012, SWIFT announced that under pressure from the European Union, it had decided to discontinue communications services to Iranian banks and financial institutions that are subject to European sanctions. Accordingly, it blocked 30 Iranian banks from using its services, literally cutting off Iran from the global banking system.

Several Iranian private banks including Dey, Saman, Pasargad, and Parsian in addition to two state-run banks - Maskan and Keshavarzi - are currently connected to the SWIFT network.

Re-disseminated by The Asian Banker

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