Visa may suspend servicing card transactions of Russian banks from October 1

"Visa said that from October 1, if the authorization requests for local operations (in Russia) come into Visa system, it does not guarantee their processing," the report says citing a letter sent by Visa to the members of the NSPC (National System of Payment Cards).

Before October 1, the NSPC should completely take over all Visa transactions [in Russia]. It is unclear whether this process is completed in time. However, such changes should not result in failing of card transactions. According to experts, Visa cherishes its reputation too much to actually refuse customers its services.

Visa actually disclaims any liability for refusal to process transactions for which it would have to open another security deposit in the Central Bank. Visa has confirmed the sending of its letter to all banks.

It was required by law for the international payment operators Visa and MasterCard to fully transfer their transactions to take place inside Russia so that they can be processed in the National System of Payment Cards instead of being routed through data centers in other countries before March 31.

MasterCard met this deadline with few exceptions, while Visa began the transfer procedure a bit later.

Read alsoRussia mulling currency purchase restrictions and price freezeAccording to Kommersant, it violated deadlines as a result and was forced to make a security deposit in the Russian Central Bank, but later it was returned (the amount was not disclosed; according to the experts, it totaled $50 million). It was also announced at the time that the “migration” of member banks to the NSPC regarding servicing the Visa cards would be completed before May 31. But in fact, only partial transfer has been implemented in this period: the acquiring banks had to send authorization requests to the NSPC, while the NSPC forwarded them to Visa.

Read alsoRussia readies for life without SWIFTFrom October 1, according to the initial scheme, banks are required to work only under the NSPC processing. However, the full migration has not been completed, and the Visa's letter to banks confirmed this. A few top-20 banks say that part of the traffic coming from some banks in the NSPC is still approved by Visa. It is impossible to estimate the scale of these transactions, as the banks have no official information on this. The NSPC and Visa say that the number of these transactions is small.

"All banks - direct participants send Russian domestic authorization requests and exchange the clearing messages on Visa cards via the NSPC. But sometimes, due to errors in the banks’ processing systems, there are isolated cases of requests being sent to Visa. That is why the banks were notified on the need for additional control and elimination of such errors," the statement says.

According to market participants, the full completion of the migration to the NSPC requires at least another month. It is hardly possible to complete this process within three working days in September.