The United States, the United Kingdom and European Union countries, including France, Germany and Italy, have decided to cut off some Russian banks from the Society for Worldwide Interbank Financial Telecommunication, or Swift, a global interbank payments system.

“This will ensure that these banks are disconnected from the international financial system and harm their ability to operate globally,” these countries said in a joint statement on Saturday.

Swift is a secure platform used by financial institutions to exchange information about global monetary transactions. The system operates as a middleman to verify transactions by providing secure financial messaging services to more than 11,000 banks in over 200 countries.

Cutting off Swift from Russia is expected to badly hit Moscow as it heavily relies on the system for trading its resources, especially for the payments for its oil and gas exports.

“If Russia is disconnected from Swift, then we will not receive [foreign] currency, but buyers, European countries in the first place, will not receive our goods – oil, gas, metals and other important components,” said Nikolai Zhuravlev, vice speaker of Russia’s Upper House of parliament, reported CNN, citing state-run news agency TASS.

Former deputy chairman of Russian Central Bank Sergei Aleksashenko has said that the decision to remove Moscow’s lenders from Swift would cause a “catastrophe” on the Russian currency market on Monday, reported The Guardian.

“I think they will stop trading and then the exchange rate will be fixed at an artificial level just like in Soviet times,” he added.

In a statement, Swift said that it was preparing to implement the new measures targeting Russian banks in the coming days, reported Reuters.

“We are engaging with European authorities to understand the details of the entities that will be subject to the new measures and we are preparing to comply upon legal instruction,” it said.

The measure came as Russia continued its invasion of Ukraine. The Russian offence has entered its fourth day with its forces entering Kharkiv, Ukraine’s second-largest city.

While the US, UK, European Union nations and other countries had put sanctions on Russia earlier, they had refrained from imposing especially damaging measures. Questions had been raised on the efficacy of the sanctions in deterring Russia from attacking its neighbour.

Other measures

In their Saturday’s statement, the countries also said that they would impose restrictive measures that will prevent the Russian Central Bank from using its international reserves to “undermine the impact” of their sanctions.

The countries said they would act against individuals and entities that were facilitating the war in Ukraine.

“Specifically, we commit to taking measures to limit the sale of citizenship – so called golden passports – that let wealthy Russians connected to the Russian government become citizens of our countries and gain access to our financial systems,” the statement said.

It said that the Western countries would launch a task force to ensure that the sanctions are implemented effectively “by identifying and freezing the assets of sanctioned individuals and companies that exist within” their jurisdictions.

The statement also also said that the countries would set up to tackle disinformation and other forms of “hybrid warfare”, a fusion of conventional and unconventional means of warfare such as the use of fake news, foreign electoral intervention and diplomacy.

“We stand with the Ukrainian people in this dark hour,” the statement said. “Even beyond the measures we are announcing today, we are prepared to take further measures to hold Russia to account for its attack on Ukraine.”