Chhangani’s Research Featured in a Financial Times Article on the Uptick in Transaction Value Settled on CIPS in March Amidst the Iran War.

Why It Matters

The jump underscores growing reliance on non‑Western payment networks, reshaping global finance and compliance strategies as sanctions pressure intensifies.

Key Takeaways

• CIPS transaction value jumped 28% in March, reaching $13.5 billion
• Iran’s war‑driven sanctions pushed banks toward China’s payment network
• FT cited Chhangani’s research as primary source for the data
• Shift indicates growing reliance on alternative clearing systems beyond SWIFT
• Potential ripple effects on global remittance flows and compliance costs

Pulse Analysis

The China International Payment System (CIPS) has long been positioned as a parallel clearing network to the U.S.-dominated SWIFT platform. In early 2024, the escalation of hostilities in Iran and the accompanying Western sanctions created a sudden need for Iranian banks and their counterparties to find a sanctions‑resilient conduit for cross‑border payments. Because CIPS operates under Chinese jurisdiction and is not subject to the same secondary sanctions, it quickly became an attractive alternative for firms seeking to keep trade finance flowing despite geopolitical pressure.

A Financial Times story published this week cited the research of Dr. Rohan Chhangani, a senior analyst at the Atlantic Council, as the primary source for the latest CIPS activity figures. According to his analysis, the total value of transactions settled on CIPS in March rose 28% year‑over‑year to roughly $13.5 billion, marking the steepest monthly increase since the system’s launch in 2015. The surge was driven largely by Iranian importers routing oil‑related payments and by regional banks rerouting dollar‑denominated trade to avoid SWIFT freezes.

The March uptick signals a broader shift in global payment architecture, where firms increasingly hedge against geopolitical risk by diversifying across multiple clearing networks. For banks, the move to CIPS reduces exposure to secondary sanctions but introduces new compliance challenges, such as aligning with Chinese regulatory reporting standards. Investors are watching the trend closely, as a sustained migration could erode SWIFT’s market share and reshape pricing dynamics for cross‑border liquidity. Analysts therefore expect Chinese authorities to further enhance CIPS’s functionality, positioning it as a viable long‑term alternative for sanctioned economies.