DUBAI: Iran and Russia have connected their interbank communication and transfer systems to help boost trade and financial transactions, a senior Iranian official said on Monday, as both Tehran and Moscow are chafing under Western sanctions.

Since the 2018 re-imposition of US sanctions on Iran after Washington ditched Tehran’s 2015 nuclear deal with world powers, the Islamic Republic has been disconnected from the Belgium-based SWIFT financial messaging service, which is a key international banking access point.

Similar limitations have been slapped on some Russian banks since Moscow’s invasion of Ukraine last year.

“Iranian banks no longer need to use SWIFT ... with Russian banks, which can be for the opening of Letters of Credit and transfers or warranties,” Deputy Governor of Iran’s Central Bank, Mohsen Karimi, told the semi-official Fars news agency.

While Russia’s central bank declined to comment on the deal signed on Sunday, Mr Karimi said, “About 700 Russian banks and 106 non-Russian banks from 13 different countries will be connected to this system”, without elaborating on the names of the foreign banks.

Published in Dawn, January 31st, 2023