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FINTEX Summit: Calls heighten for alternative financial market technologies


The destabilization of global trade and an alleged desire by Western countries to maintain a monopoly on the management of the global financial system is increasingly forcing Eurasian regional powers to seek new mechanisms of cooperation.

In mid-May, Azerbaijan hosted the FINTEX summit, which brought together top managers of the largest banks and fintech companies from the Caucasus and Central Asia, as well as heads of Russian and Turkish companies. The key topics of the summit were the development of payment systems and cyber security issues of the regional financial market.

Although the majority of FINTEX guests represented neutral countries that have not yet been affected by any sanctions imposed by the US, UK, or EU, the numerous restrictions imposed by the West against such countries as Russia, China, and Iran largely determined the key topics discussed at the summit. It should be borne in mind that for many decades the architecture of global trade and mutual settlements has been shaped primarily on the basis of the Western banking system and technologies.

Global platforms such as VISA, MasterCard or SWIFT are owned and controlled by the Americans and Europeans, and therefore give them the ability to monitor any transactions or to cut off unwanted states from the possibility of carrying out financial transactions.

Unfortunately, the US and the EU to solve their own political and economic problems, which is especially evident in the conflict that has erupted between the West and Moscow, more and more often, use such power. Since 2014, over 10,000 different sanctions have been imposed against the Russians, including against their financial sector. In recent years, many American, British, and European companies, VISA, and MasterCard payment systems have left Russia under pressure from their own governments, and most Russian banks have been disconnected from the SWIFT platform, through which most financial transactions in the world are carried out. Moscow says such sanctions were imposed hoping to paralyze Russia’s domestic and foreign trade, but this did not happen, as the Kremlin managed to very quickly develop and implement its technological solutions that replaced Western systems.

Russia also maintains that the Western sanctions have significantly complicated the lives of many neutral countries whose economies are closely linked to it, and the impossibility of normal interbank relations causes them direct and very significant damage. Such states as Turkey, Azerbaijan, Kazakhstan, or Armenia are, for historical and geographical reasons, major trading partners of Russia and are somehow forced to find ways to circumvent Western sanctions and restrictions.

At the FINTEX summit, the matter came up and the suggestions to support alternative platforms such as the Russian SPFS system, an equivalent of SWIFT, and the introduction of the MIR platform, an equivalent of VISA and MasterCard, were actively discussed.

It is noteworthy that increased interest in Russian developments in the financial and technological sphere is shown not only by Iran, Cuba, and other states under Western sanctions but also by those who are interested in trade and cooperation with the Russians or who fear that sooner or later they may become victims of the geopolitical power plays.

To some extent, MIR or SPFS are already in use in most of Russia’s neighboring countries in the Caucasus and Asia, and representatives of those banks and companies that took part in the FINTEX summit noted they were reliable as much as the other systems in place.

Russia says cooperation with its neighbors and partners in the financial sphere shows that the threats to which many sovereign states are currently exposed to in the political, trade and economic spheres can only be overcome by diversifying the systems used. Critics have also claimed that the convenience and mass spread of Western payment systems and technologies are completely offset by their dependence on the policies of the US and EU governments. They argue that, in a situation where at the touch of a button entire countries can be instantly disconnected from the global financial system, it is crucial to have alternative channels to preserve one’s own political and economic sovereignty. China and Russia have been cited as countries that are already developing solutions and making technologies available for the financial market and soon such technological products will be in high demand around the world.

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