International Finances: US reacts as the dollar faces greater challenge with BRICS countries mulling integration of national payment systems


“The list of members that reportedly want to join BRICS includes Saudi Arabia, Iran, Egypt, Bahrain, Algeria, Argentina and Indonesia, as well as three additional undisclosed nations in Africa”

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The US dollar is facing a greater threat as the major world currency as two of the largest members of BRICS are reportedly exploring how they can link their payment systems. According to the Economic Times, India’s External Affairs Minister S Jaishankar and Russia’s Deputy Prime Minister Denis Manturov are analyzing how the two countries can create new payment avenues that could circumvent financial sanctions levied against Moscow.

The recent talks between Russia and India come as BRICS moves to create a new global currency that doesn’t rely on the US dollar.

According to the report, Jaishankar and Manturov agreed to determine how they can integrate India’s Unified Payment Interface (UPI) and Russia’s Faster Payments Systems (FPS).

The UPI is a mobile payment method which allows users to make real-time transfers, while the FPS is a service that enables users to transfer funds between banks using their mobile number.

The two government officials also agreed to look into adopting the Financial Messaging System of the Bank of Russia for cross-border payments in an effort to move away from the global interbank platform SWIFT.

BRICS is a group of economically-aligned nations that currently includes Brazil, Russia, India, China, and South Africa which has been attarcting more membership in recent years. The group, which plans to launch a global currency to compete with the US dollar, has drawn interest from more than a dozen countries that want to join in.

The list of members that reportedly want to join BRICS includes Saudi Arabia, Iran, Egypt, Bahrain, Algeria, Argentina and Indonesia, as well as three additional undisclosed nations in Africa.

According to Anatoly Aksakov, Russia’s Chairman of the State Duma Committee on the Financial Market, negotiations about the details of the new currency are underway and the economic alliance might reach an agreement by the end of the year.

Foreign ministers representing the five current BRICS members will meet in June to discuss expansion efforts and the group’s push to create a new currency that will likely be pegged to gold and potentially additional assets.

Meanwhile, the online, Daily Hodl May 5, 2023 reported that the US State Department has responded to reports that the BRICS is preparing for a major expansion.

The reported quoted the State Department officials as telling Fox News that current US policy will not interfere with African or other nations looking to join in.

“We lead with an affirmative agenda for Africa, demonstrating the benefits of our governance and economic models.

US policy does not ask our partners to choose between the United States and other countries.”

State Department officials say the agency’s intent with international partners is focused on boosting democratic governance, human rights and economic opportunity, as opposed to controlling economic alliances.

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