The U.S. and allies agreed to block “selected’ Russian banks from the SWIFT global financial messaging system on Saturday.
SWIFT is an independent enterprise that serves as an internal messaging system between banks and financial institutions in more than 200 countries and territories.
The disconnection from SWIFT is partial, leaving Europe and the U.S. room to escalate penalties further later.
EU Commission President Ursula von der Leyen said the measures would push the bloc to “paralyze the assets of Russia’s Central bank” so that its transactions would be frozen.
This is not the first time allies have considered blocking Russia from SWIFT.
It was also considered in 2014, when Russia invaded and annexed Ukraine’s Crimea and backed separatist forces in eastern Ukraine.
There was hesitancy in blocking Russia from the system because it will likely hurt other world economies, including those of the U.S. and Germany.
The U.S., E.U. and Canada also announced on Saturday that they will impose restrictive measures that will prevent the Russian Central Bank from using international reserves.
Countries also plan to restrict the sale of so-called “golden passports”, which allow wealthy Russians connected to the Russian government to become citizens of other countries and gain access to financial systems.
Experts believe this latest round of sanctions will hurt Russia’s economy and reinforce other sanctions.