Iranian banks to be cut off from international payment system

Transfer hub will disconnect Iranian banks that are subject to sanctions imposed by EU

The international banking transfer system Swift is to cut ties with Iranian banks which are subject to EU sanctions.

The Belgium-based banking hub is crucial to oil, financial transactions and other trades. It has faced international pressure, particularly from the US, to prevent Tehran from sending or receiving payments electronically.

Global financial transactions are impossible without using Swift, which stands for Society for Worldwide Interbank Financial Telecommunication.

Swift said on Thursday that it would disconnect sanctioned Iranian financial institutions from its messaging system on Saturday at 4pm GMT.

“Disconnecting banks is an extraordinary and unprecedented step for Swift,” the chief executive, Lazaro Campos, told Associated Press. “It is a direct result of international and multilateral action to intensify financial sanctions against Iran.”

The EU sanctions are aimed at forcing Iran to demonstrate to the international community that it is not trying to develop nuclear weapons. Iran says that its nuclear programme is for peaceful purposes only. © 2012 Guardian News and Media Limited or its affiliated companies. All rights reserved. | Use of this content is subject to our Terms & Conditions | More Feeds

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