Following sanction orders related to Russia’s ongoing military operation in Ukraine, international card companies Mastercard and Visa have disconnected a number of Russian banks from their payment systems.
Mastercard CEO Michael Mibach said on Tuesday that, as a result of the sanctions orders, his company has blocked several financial institutions in the Mastercard payment network, and announced they’ll work with regulators to fully comply with its obligations in the coming days.
The card company notified on February 26 the banks encompassed with its blocking sanctions that they were suspending their participation in the system.
Though it did not specify which institutions will be cut off, the list of Russian banks which fall under the sanction orders Washington announced last week shows that these include Novikombank, Sovcombank, VTB, Otkritie, and Promsvyazbank.
Their assets and dollar accounts have already been blocked, and Apple Pay and Google Pay for these banks’ cards stopped working.
Sberbank has also faced restrictions, but its assets have so far avoided freezing and only its correspondent accounts will be closed. Credit Bank of Moscow, Alfa-Bank, Gazprombank, and RSHB, on the other hand, were subject to sectoral sanctions, with only a few restrictions.
Although it has not yet specified the details, the international payment system Visa will also be taking prompt measures to enforce Ukraine-related sanctions, according to which clients of sanctioned banks will not be able to pay with their Visa and Mastercard cards abroad and on foreign websites.
However, since payments within Russia are processed via the internal National Payment Card System (NSPK), created in 2014, the cards will continue to work in the country.
Only a day before, Kirill Shevchenko of the National Bank of Ukraine called on Visa and Mastercard to stop servicing Russian banks from their payment systems.
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