Putin Signs Law on National Card Payment System as Visa and MasterCard Deny Service to Russian Banks | Global Research
Putin Signs Law on National Card Payment System as Visa and MasterCard Deny Service to Russian Banks | Global Research
Russian President Vladimir Putin has signed into law a bill to
create a national card payment system, the Kremlin press service said
Monday.
The Russian parliament approved the bill last month.
Plans to establish a national card payment processing system emerged
in response to Ukraine-related sanctions that saw several Russian banks
denied service by global powerhouses Visa and MasterCard, troubling the
general public and raising concern over the security of the country’s
financial system.
As a reaction to Crimea reunifying with Russia in mid-March, the US
introduced targeted sanctions against Russian officials and Rossiya
Bank, considered by the US Treasury to be a private bank for many
Russian government officials.
Following the move, Visa and MasterCard stopped client operations for
cardholders at Rossiya Bank, SMP Bank, as well as their subsidiaries
Sobinbank and Investkapitalbank with no prior notice, causing a serious
drop in the consumer confidence of the banks.
According to Russian Central Bank estimates, building the
infrastructure for the launch of the national payment system may take up
to six months, but the distribution of the cards to the public could
take up to two years.
Visa and MasterCard have announced they were concerned about the
future of their business in Russia in light of the new legislation.
