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Finance and Credit
 

Settlement risk in international economic transactions

Vol. 28, Iss. 8, AUGUST 2022

Received: 14 July 2022

Received in revised form: 28 July 2022

Accepted: 11 August 2022

Available online: 30 August 2022

Subject Heading: INTERNATIONAL PAYMENT MECHANISMS

JEL Classification: E42, F24, F33, F38

Pages: 1831–1851

https://doi.org/10.24891/fc.28.8.1831

Andrei K. LYAMENKOV Lomonosov Moscow State University (MSU), Moscow, Russian Federation
liamenkov@yandex.ru

https://orcid.org/0000-0003-0544-5271

Subject. This article deals with the issues related to the settlement risk in the implementation of international payment transactions for domestic participants in foreign economic activity.
Objectives. The article aims to investigate the settlement risk problems in the implementation of international payment transactions, as well as find ways to avoid and minimize such risk.
Methods. For the study, I used the methods of abstraction, induction and deduction, synthesis, and comparative analysis.
Results. The article describes the modern specifics of the implementation of settlement risk in the international payment system, associated mainly with political sanctions reasons. The article also proposes relevant ways for domestic subjects of foreign economic activity to avoid and reduce such a risk, involving the participation of government agencies in the formation of new payment mechanisms.
Conclusions. In modern conditions, the international payment system inevitably increases the percentage of settlements in national currencies that are not toxic for participants in foreign economic activity, the use of international clearing mechanisms in operations with counterparties from friendly countries, the use of barter and compensation transactions, as well as the testing of innovative methods of payment in cryptocurrency and stablecoin.

Keywords: international payment system, settlement risk, correspondent bank account, sanctions, international clearing arrangement

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