Global payment systems may leave Russia – media

Visa and MasterCard international payment systems may leave Russia as a result of Western sanctions and retaliatory actions by the Russian State Duma and the Central Bank.

"On July 23, the lower house of the State Duma is going to consider in the second reading amendments to the draft law on the national payment system, which are supported by the Central Bank; they must ensure continuity of card payments in Russia. In fact, international payment systems' Russian-based subsidiaries will be prohibited to suspend payments by cards of banks slapped with sanctions. The amendments will affect the international payment systems, whose subsidiaries are registered with the Central Bank, in particular Visa, MasterCard, China Union Pay, and JCB," the Ukrainian news outlet Strana.ua wrote on July 12.

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It is noted if the bill is adopted, it will prohibit to introduce "criteria for suspension, termination of participation in the payment system at the initiative of the payment system operator, associated with the suspension, termination of participation in the foreign payment system." The payment systems will be given six months to start working under the new rules. After that, the suspension of payments by any bank due to the sanctions will be considered a violation. If it is not eliminated, the Central Bank will exclude the company from the register of payment system operators, which will mean a ban on operation in Russia.

At the same time, the Russian-based subsidiaries of Visa and MasterCard, despite their intention, will not be able to bring their rules into line with the new requirements since they have no right not to execute the orders of their parent companies. Visa and MasterCard will probably have an opportunity to remain on the Russian market as operators of "foreign payment systems" (this concept is also introduced by amendments to the bill). However, experts interviewed by the news outlet believe most likely these companies will simply wind down operations in Russia.