Jim O’Neill, the former Goldman Sachs economist who coined the term BRIC back in 2001, has told Reuters that the idea of the bloc building alternatives to the US dollar no longer seems like a distant fantasy. The reason: rapid advances in payment technology.
O’Neill said that newer payment systems make the prospect feel far more realistic than it did just 18 months ago. While he is not predicting an imminent collapse of the dollar’s dominance, his comments signal a shift in how seriously the idea is being taken—even by the person who gave the group its name.
What is BRICS and why does the dollar matter?
BRICS is an informal grouping of major emerging economies: Brazil, Russia, India, China, and South Africa. The bloc has expanded in recent years to include new members like Iran, Egypt, Ethiopia, and the United Arab Emirates. The group represents a significant share of the world’s population and economic output, but its members have long chafed at the dominance of the US dollar in global trade and finance.
The dollar is the world’s primary reserve currency. It is used to invoice most international trade, settle cross-border payments, and is held in vast quantities by central banks. That gives the United States enormous influence over the global financial system—and leaves other countries exposed to US monetary policy and sanctions.
For years, talk of “de-dollarization” was mostly theoretical. But O’Neill’s latest comments suggest the technological groundwork is being laid for something more concrete.
What has changed in 18 months?
O’Neill told Reuters that the rapid development of digital payment systems—especially in India, China, and Brazil—has changed the calculus. He specifically mentioned India’s Unified Payments Interface (UPI), China’s Cross-Border Interbank Payment System (CIPS), and Brazil’s PIX as examples of fast, efficient payment networks that could be linked together.
These systems already handle enormous volumes of domestic transactions. The idea is that by connecting them, BRICS countries could create a web of payment channels that bypass the dollar-based SWIFT system. Reuters reports that BRICS has discussed options like BRICS Pay, a proposed platform that would allow member countries to settle trades in their own currencies.
None of this means the dollar is about to be dethroned. The dollar’s role is deeply entrenched, and any alternative would need to be trusted, liquid, and widely accepted. But O’Neill’s point is that the plumbing is changing—and that makes the idea feel less like a pipe dream.
What it means for investors
For everyday investors, the key takeaway is not that the dollar is doomed, but that the landscape is shifting in ways that could matter over the long term. If BRICS countries succeed in building alternative payment systems, it could reduce demand for US dollars in global trade, which might put downward pressure on the greenback over time.
A weaker dollar can have mixed effects. It makes US exports cheaper and can boost multinational companies that earn revenue abroad. But it also means that imported goods become more expensive, which can feed into inflation. For investors with international exposure, currency moves can significantly affect returns.
Emerging market stocks and currencies often benefit when the dollar weakens, as capital flows toward higher-yielding assets. That dynamic is already visible in markets: the dollar has been strengthening recently as markets await Fed minutes and key economic data, but a shift in the dollar’s long-term trajectory could change the calculus for emerging market investors.
Countries like India and Brazil, which are leading the push for alternative payment systems, could see increased investor interest if their currencies become more widely used in trade. However, these are long-term trends, not overnight shifts.
What to watch next
Investors should keep an eye on several developments. First, any concrete announcements from BRICS summits about the rollout of BRICS Pay or similar initiatives. Second, the adoption of local currency settlement agreements between member countries. Third, the performance of emerging market currencies like the Indian rupee and Brazilian real, which could benefit from reduced dollar dependence.
The rupee recently slipped to a three-week low as oil importers and NDF maturities drove dollar demand, highlighting that currency dynamics are still heavily influenced by traditional factors. But if payment technology continues to evolve, those dynamics could gradually shift.
O’Neill’s comments are a reminder that the financial world is not static. The dollar’s dominance has been a given for decades, but technology—and geopolitical will—are starting to chip away at the edges. For now, it’s a story to watch, not a reason to overhaul a portfolio.
