Dollar Desertion: China's CIPS Beats SWIFT
Traders flee SWIFT and the dollar for CIPS and the renminbi.
China’s Cross-Border Interbank Payment System, CIPS, briefly surpassed SWIFT’s single-day transaction volume and throughput by processing a massive $1.76 trillion on April 16, 2025.
Russia’s exclusion from SWIFT pushed it to use RMB via CIPS making Russia the top CIPS user by 2023. BRICS dedollarization efforts (e.g., Saudi Arabia, Argentina joining CIPS) accelerated the process and today, more than 1,300 CIPS members in ASEAN, UAE, Iran, and Qatar use CIPS increasingly for oil/gas trades.
CIPS has grown 25% annually since its inception in 2021 and, while it conducts 80% of international RMB transactions and, despite its strategic advantages, still lags far behind SWIFT (Society for Worldwide Interbank Financial Telecommunication). But the shift to CIPS is undeniable thanks to its strategic advantages:
Speed
CIPS settles in seconds while. SWIFT’ requires 2-3 business days. CIPS real-time RMB settlements beat SWIFT’s, which relies on correspondent banking. CIPS functional advantage is that it combines SWIFT-like messaging with direct clearing, reducing dependency on third-party banks.
Service
CIPS is the preferred payment system for BRI projects, with 75% of participating banks using it. China is also the largest trading partner for most countries and CIPS processes RMB payments directly, while SWIFT requires USD/EUR/RMB conversions, adding time, cost and complexity. CIPS also connects directly to China’s Domestic Foreign Currency Payment System (DFEPS) and China National Advanced Payment System (CNAPS), streamlining domestic-foreign linkages.
Security
CIPS is a sanctions-resistant channel for countries like Russia, Iran and Venezuela facing US/EU financial restrictions. Russian banks expanded CIPS usage to bypass SWIFT after the 2022 Ukraine war because Belgium-based SWIFT complies with U.S. sanctions while CIPS operates under China’s legal framework.
Convenience
CIPS provides real-time RMB settlements while SWIFT relies on slower correspondent banking. CIPS combines SWIFT-style messaging (ISO 20022) with direct clearing, reducing dependency on third-party banks.
Cost
Companies using CIPS save millions annually: CIPS charges $1,000 and takes one hour to process a 170,000 m³ LNG cargo worth $70 million. SWIFT takes 2-3 days and
charges $575,000 for the same cargo.
SWIFT’s edge
SWIFT’s remaining advantages are its global reach: it connects 11,000 banks in 200 countries vs. CIPS’ 1,400, mostly in Asia. SWIFT handles 150 currencies while CIPS (though it supports others) is optimized for RMB . SWIFT’s non-RMB liquidity pools are deeper than CIP’s. SWIFT is still essential for global multi-currency trades.