CIPS, SPFS and the Rise of SWIFT Alternatives for International Payments

SWIFT — the Society for Worldwide Interbank Financial Telecommunication — has underpinned international banking messaging for over 50 years. With more than 11,000 member institutions across 200 countries processing approximately 50 million messages per day, it is the closest thing to a universal financial language. Yet in the past decade, geopolitical shifts have accelerated the development of credible alternatives, and internationally mobile clients and businesses need to understand how this fragmentation affects their ability to move money across borders.

What SWIFT Actually Does (and Doesn't Do)

A common misconception is that SWIFT moves money. It does not. SWIFT is a secure messaging network — it carries instructions between financial institutions telling them how to move funds held in accounts. The actual settlement of funds happens through correspondent banking relationships and national payment systems.

When you send an international wire transfer from London to Tokyo, your bank sends a SWIFT message to its correspondent bank (or directly to the recipient bank if they have a relationship), instructing it to debit the relevant account and credit the beneficiary. The SWIFT message contains standardised information: account numbers, beneficiary details, amounts, purpose codes.

What this means in practice is that SWIFT sanctions have teeth precisely because they disconnect financial institutions from the messaging network that coordinates correspondent banking. When Russia's central bank and several major Russian banks were expelled from SWIFT in February 2022 following the invasion of Ukraine, the practical effect was to make it extremely difficult to settle payments with those institutions — not because money literally could not move, but because the coordination mechanism was severed.

SPFS: Russia's SWIFT Alternative

Russia had been developing its own financial messaging system — the System for Transfer of Financial Messages (SPFS) — since 2014, following the threat of SWIFT disconnection after the annexation of Crimea. By the time the 2022 expulsion occurred, SPFS was operational and processing a significant portion of domestic Russian financial traffic.

However, SPFS has significant limitations as a genuine SWIFT alternative for international transactions:

Limited participation: As of 2026, SPFS participants are overwhelmingly Russian domestic banks plus a limited number of institutions in countries with close economic ties to Russia — primarily Belarus, Armenia, Kazakhstan, and a handful of others. Banks in major Western financial centres do not participate.

Message format differences: SPFS uses a different message standard from SWIFT's MT/ISO 20022 formats, creating interoperability challenges for non-Russian participants who would need to implement additional translation layers.

US dollar settlement limitations: Since the US dollar is primarily settled through the US correspondent banking system, SPFS can only facilitate payments in non-dollar currencies (primarily roubles) with any practical independence from US sanctions infrastructure.

The net assessment is that SPFS has provided meaningful resilience for Russia's domestic banking system but has not achieved — and may never achieve — the international reach needed to meaningfully substitute for SWIFT connectivity with major global trading partners.

CIPS: China's Cross-Border Payment Infrastructure

The Cross-Border Interbank Payment System (CIPS) is China's cross-border payment system, developed by the People's Bank of China (PBOC) and launched in 2015. Unlike SPFS, CIPS was designed from the outset with international participation in mind and is explicitly intended to facilitate renminbi-denominated cross-border payments.

CIPS differs from SWIFT in an important technical respect: it combines both the messaging function and the actual clearing and settlement of renminbi payments in a single system, whereas SWIFT is purely a messaging network that relies on correspondent banking for settlement.

Current scale: As of late 2025, CIPS has around 193 direct and over 1,570 indirect participants across more than 120 countries and regions. This includes a significant number of major international banks — including institutions headquartered in Europe, the Middle East, and Southeast Asia — that participate in order to process renminbi payments for their clients.

Relationship with SWIFT: Critically, CIPS currently uses SWIFT messaging standards for its cross-border communications, meaning that CIPS and SWIFT are largely complementary rather than competitive for most participating institutions. CIPS provides the clearing and settlement infrastructure for renminbi; SWIFT provides the messaging layer. Severing CIPS from SWIFT entirely would require CIPS to implement a fully independent messaging capability — something the system is theoretically capable of but has not deployed at scale.

Renminbi internationalisation: CIPS is central to China's broader objective of internationalising the renminbi. As China's trade relationships with Belt and Road Initiative partners deepen, more bilateral trade is being settled in renminbi rather than US dollars, and CIPS provides the infrastructure for these settlements. For businesses or investors with significant exposure to Chinese trade or investment flows, understanding CIPS is increasingly important.

Project mBridge: Central Bank Digital Currency for Cross-Border Payments

The most technologically innovative development in cross-border payment infrastructure is Project mBridge — a multi-central-bank digital currency (CBDC) platform developed jointly by the central banks of China, Hong Kong, Thailand, the UAE, and Saudi Arabia (which joined in June 2024). The Bank for International Settlements (BIS) Innovation Hub incubated the project but stepped back from it on 31 October 2024, handing it to the participating central banks to take forward.

Project mBridge uses a purpose-built distributed ledger technology (DLT) platform to enable direct, near-instantaneous settlement of cross-border payments in central bank digital currencies between participating jurisdictions, bypassing the correspondent banking chain entirely.

In a six-week pilot of real-value transactions in 2022, mBridge settled 164 payment and FX transactions totalling over USD 22 million across participating jurisdictions, with settlement times measured in seconds rather than the days typically required for correspondent banking chains. The platform reached minimum viable product (MVP) stage in 2024.

What this means for international payments: If mBridge achieves its ambition of broad commercial deployment and more jurisdictions join, it could fundamentally alter the economics and efficiency of cross-border payments for participating corridors. Payments between, say, Hong Kong and the UAE could potentially settle in near-real time without correspondent bank fees, currency conversion friction, or SWIFT messaging costs.

Geopolitical dimension: Project mBridge has attracted considerable attention — and some concern — from Western regulators precisely because it provides a payment infrastructure that operates independently of the US dollar correspondent banking system and SWIFT messaging. While the BIS has emphasised the system's technical neutrality, the political implications of a payment corridor that cannot be sanctioned through US dollar controls are significant.

Other Regional Alternatives

Beyond CIPS and SPFS, several regional payment systems have developed with varying degrees of SWIFT independence:

INSTEX (EU): The Instrument in Support of Trade Exchanges was created in 2019 by France, Germany, and the UK to facilitate non-dollar trade with Iran while nominally complying with US sanctions. Its practical use was extremely limited, and it was largely abandoned by 2023.

India's UPI International: The Unified Payments Interface has begun expanding internationally, with cross-border retail payment corridors established with Singapore, UAE, Mauritius, and others. This is primarily a retail payment system rather than a wholesale banking infrastructure, but it is significant for remittances.

Arab Monetary Fund's Buna: The Buna payment platform, operated by the Arab Monetary Fund, provides multi-currency cross-border payment capabilities for Arab countries and beyond, supporting transactions in Arab currencies alongside major international currencies.

African payment integration: The African Continental Free Trade Area (AfCFTA) has included payment integration as a priority, with the Pan-African Payment and Settlement System (PAPSS) operational since 2022 to facilitate intra-African payments in African currencies.

What This Means for International Clients

For HNW individuals, expats, and internationally operating businesses, this fragmentation of global payment infrastructure has several practical implications:

For clients with significant RMB exposure: CIPS participation by your bank matters. If you have trade, investment, or property interests in China and need to move renminbi regularly, understanding whether your bank has direct CIPS participation — and what charges it applies — is important.

For clients operating in sanctioned corridors: Legal trade and investment that happens to involve jurisdictions under partial sanctions (some Iranian entities, some Russian entities, Cuban entities) may find that alternative payment infrastructure — where legal under applicable sanctions regimes — opens possibilities that the SWIFT/correspondent system has closed.

For risk management: Concentration risk in a single payment infrastructure is a legitimate concern for large organisations. Diversifying payment providers across both SWIFT-based and alternative messaging corridors where applicable is increasingly standard treasury practice for multinational corporations.

For the future: The trajectory of central bank digital currencies and real-time payment systems strongly suggests that the long-term future of international payments involves greater speed, lower cost, and potentially less dependence on the existing correspondent banking network. Clients building long-term financial infrastructure should understand these dynamics.

How Global Investments Can Help

Global Investments works with internationally mobile clients and businesses to structure cross-border payment arrangements that are efficient, compliant, and resilient to geopolitical disruption.

Whether you are managing renminbi cash flows, navigating sanctions-adjacent jurisdictions legally, building treasury infrastructure for a multinational operation, or simply seeking to reduce the cost and friction of routine international transfers, our team can provide informed guidance across the full spectrum of available payment infrastructure.

Contact us for a consultation on your specific international payment requirements.

Information is provided for educational purposes as of 2026. Sanctions regimes, SWIFT policies, and payment system participation change rapidly. This guide does not constitute sanctions advice. Seek appropriate legal and compliance counsel before making payment decisions involving sanctioned or restricted jurisdictions.