BRICS member Russia confirmed on Sunday that Kremlin is working towards building a new payment system without incorporating the U.S. dollar. Russia aims to build a new payment mechanism to settle cross-border transactions with BRICS and other developing countries bypassing the US dollar. The decision to build a new payment system comes after the U.S. pressed sanctions on Russia for invading Ukraine.
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If Russia succeeds in building a new payment system asking BRICS and other countries to pay in local currencies, the U.S. dollar will be the hardest hit currency. Read here to know how many sectors in the U.S. will be affected if BRICS ditches the dollar for trade.
BRICS: Russia Confirms Building a New Payment System With No U.S. Dollar Mechanism
Kremlin spokesperson Dmitry Peskov confirmed that Russia is advancing towards building a new payment mechanism without the U.S. dollar. He also called the traditional world order dominated by the U.S. dollar system “unreliable, false, and dangerous”.
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“Russia is building a new system of economic connections because the previous system turned out to be unreliable, false, and dangerous. Russia is looking for an opportunity to develop alternatives,” confirmed Peskov to MenaFN.
However, Peskov did not specify the nature of the new payment mechanism and its scalability. He did not provide insights into the new payment system approved by BRICS to challenge the U.S. dollar. Further details about the payment network are kept under wraps and Russia is unwilling to provide insights.
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The new payment system idea comes at a time when BRICS is aiming to uproot the U.S. dollar’s supremacy. BRICS members China and Russia are spearheading the de-dollarization campaign convincing other developing countries to settle trade in local currencies. Read here to know how many countries want to ditch the U.S. dollar and settle trade in local currencies.