BRICS finance ministers discuss possibility of efficient cross-border payment mechanisms
BRICS finance ministers and central bank governors discussed the possibility of developing efficient cross-border payment mechanisms, drawing on the work of the BRICS Payment Task Force (BPTF), guided by prior Kazan and Rio summit declarations.
The BPTF has been studying the cross-border interoperability of payment and messaging channels among BRICS members, and ministers discussed promoting trade settlement and investment using BRICS countries' local currencies rather than a dominant reserve currency.
Discussions took place under India's 2026 BRICS Chairship, ahead of the 18th BRICS Summit scheduled to be hosted in New Delhi.
Ministers encouraged the BPTF to continue exploring practical solutions that are fast, low-cost, accessible, transparent, and safe for cross-border BRICS transactions.
BRICS: Origin, Expansion, and Institutional Architecture
BRICS began as "BRIC" (Brazil, Russia, India, China), a term coined in a 2001 Goldman Sachs report, and became a formal grouping when Russia hosted the first BRIC summit in 2009; South Africa joined in 2010, making it BRICS. The bloc represents major emerging economies coordinating on economic and financial governance issues outside traditional Western-led institutions.
The finance-track discussion on payments falls under BRICS' broader financial-architecture ambitions (alongside the NDB and CRA), which aim to reduce dependence on Western-dominated payment and reserve-currency systems — a running UPSC theme on "alternative multilateral financial institutions."
BRICS Payment Task Force (BPTF) and Cross-Border Payment Interoperability
The BPTF is a technical working group under the BRICS finance track that studies how different countries' domestic payment and messaging systems (e.g., India's UPI, Russia's SPFS, China's CIPS) can interoperate for cross-border transactions, without necessarily creating a single new common currency or payment platform.
Key Details
- BPTF's mandate draws from the Kazan Declaration (2024 Russia Chairship) and Rio Declaration (2025 Brazil Chairship), which called for exploring practical, non-discriminatory cross-border payment solutions.
- The focus is on interoperability of existing national payment/messaging rails rather than a single BRICS currency, addressing earlier (largely shelved) proposals for a common BRICS currency.
- India's Unified Payments Interface (UPI), operated by the National Payments Corporation of India (NPCI), has been cited internationally as a model for real-time payment systems and has existing bilateral linkages with several countries (e.g., Singapore's PayNow, UAE, Sri Lanka).
The BPTF's cross-border interoperability study is the concrete mechanism behind ministers' talk of "efficient cross-border payment mechanisms," and India's UPI experience is often cited as a reference model in these BRICS-level discussions.
Local-Currency Trade Settlement and De-dollarisation
Local-currency settlement refers to bilateral or multilateral trade being invoiced and settled in the participating countries' own currencies (e.g., Indian Rupee, Russian Rouble) instead of a third-country reserve currency such as the US dollar, reducing transaction costs, exchange-rate exposure, and dependence on dollar-clearing systems.
Key Details
- The RBI's July 2022 circular on Rupee-denominated trade settlement mechanisms allowed Indian banks to open Special Rupee Vostro Accounts for settling trade with partner countries in rupees.
- BRICS discussions on local-currency settlement are distinct from, and do not require, a common BRICS currency; they instead expand bilateral currency-swap and vostro-account arrangements.
- Such moves are often discussed in the context of reducing "dollar dependency" in trade, though the US dollar remains the dominant global reserve and invoicing currency by a wide margin.
The finance ministers' push for trade settlement "using local currencies of BRICS countries" builds on existing bilateral rupee-settlement mechanisms and reflects the broader de-dollarisation debate within BRICS, without proposing a single common currency.
- BRICS founding: 2009 (Russia hosted first summit as BRIC); South Africa joined 2010, forming BRICS.
- 2024-25 expansion added Saudi Arabia, Iran, UAE, Egypt, and Ethiopia as new members (Argentina declined its invitation).
- New Development Bank: operational since 2014/2015, $100 billion authorised capital, headquartered in Shanghai.
- Contingent Reserve Arrangement: established 2015, $100 billion pool for short-term liquidity support.
- India holds the BRICS Chairship in 2026 and is hosting the 18th BRICS Summit in New Delhi, its fourth time chairing the grouping.