BICOM

The world’s biggest electronic payment system is expected to cut off Iranian banks blacklisted by the European Union in an attempt to further inhibit Tehran’s ability to finance its nuclear programme.

The move is an unprecedented measure that will effectively prevent Iranian institutions from electronically transferring global funds.

The Belgium-based SWIFT, which facilitates the bulk of global cross-border payments, said it would disconnect designated Iranian financial firms from its messaging system on Saturday at 1600 GMT after European regulators ordered the company to do so.

SWIFT CEO Lázaro Campos said that the EU decision to sanction Iranian banks forced “SWIFT to take action,” adding, “Disconnecting banks is an extraordinary and unprecedented step for SWIFT. It is a direct result of international and multilateral action to intensify financial sanctions against Iran.”

In response to SWIFT’s Thursday announcement, the Prime Minister’s Office in Israel released a statement later in the day, saying “Prime Minister Netanyahu congratulated SWIFT for its decision to cut the Iranian banks from the system.”

In December, EU foreign ministers adopted sanctions against Iran in response to the country’s nuclear programme.

SWIFT, or Society for Worldwide Interbank Financial Telecommunication, has been described as the glue of the global banking system, handling daily payments estimated at more than $6 trillion.