The Iranian finance ministry's banking and insurance department has declared that Iran could join Mir payment system within months, according to Al Mayadeen . The decision will be made when talks between Tehran and Moscow reach a conclusion, according to Qorban Eskandari, the department's head.

The Mir banking system is Russia's alternative to SWIFT, a way paved to curb Western sanctions. According to Eskandari, however, the talks on Mir between the two countries are restricted to bilateral financial ties and countries that have access to Mir's banking services. Launched in 2017, Mir is a Russian banking system, meaning both ‘peace’ and ‘world’ in the language.

With the West's current isolation measures of Russia, Iran, Cuba, and other countries from the SWIFT banking system, friendlier alternatives have been on the rise in a bid to combat the West's economic actions. South Korea and Turkey, in addition, have also joined Mir, and several former Soviet republics benefit from its services. The United Arab Emirates is also looking to join Mir in the future.

In July 2022, authorities in the Iranian foreign ministry announced that they will soon begin to accept Mir cards for transactions. The development in economic relations came during rising reports that Tehran and Moscow were working on expanding economic relations to combat US sanctions. On 23 July 2022, Iran's Currency Exchange (ICE) launched a currency pairing system that enables exporters and importers to make payments in both the Iranian rial and the Russian ruble.

Russia was banned from SWIFT In February 2022, Russian banks were excluded from the SWIFT interbank payment system by the decision of the European Commission and its allies. The maneuver was intended to hit the country's banking network and its access to funds via SWIFT, which is pivotal for the smooth transaction of money worldwide. The EU excluded 7 major Russian banks - Bank Otkritie, Novikombank, Promsvyazbank, Rossiya Bank, Sovcombank, Vnesheconombank (VEB), and VTB Bank – from The Society for Worldwide Interbank Financial Telecommunication (SWIFT), a secure messaging system for banks, which facilitates rapid cross-border payments.

Additionally, the US Office of Foreign Assets Control (OFAC) also imposed a full embargo on trade in US dollars with Russia for the two banks, among other institutions, narrowing the playing field even more. For more information about Russia’s financial sanctions, we encourage you to read our comprehensive analysis. .