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Visa and Mastercard May Soon Exit Russia Under Draft Law

Rogue Valley

Rogue Valley

Lead or get out of the way
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Visa and Mastercard May Soon Exit Russia Under Draft Law — Reports | The Moscow Times

Two-thirds of entrepreneurs called the Russian business environment unfavorable.

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7/12/19
New Russian payment system laws could lead the world’s largest credit and debit card companies Visa and Mastercard to exit the country’s market, the Kommersant business daily reported on Friday. U.S.-based Visa and Mastercard stopped servicing bank cards in annexed Crimea after the United States imposed sanctions on Russia in 2014. Russia created its own card payment system because it feared U.S. and European sanctions against some Russian banks and business-people over Crimea could block Visa and Mastercard transactions. Russian lawmakers are now considering new legislation that will in effect prohibit international payment systems from refusing to process transactions in compliance with sanctions, Kommersant reported. “We shouldn’t encourage such shutoffs [in operations by payment systems] and tolerate discriminatory rules,” says the bill’s co-author Anatoly Aksakov, the head of the State Duma Financial Markets Committee. If passed, companies like Visa and Mastercard will be required to register in Russia within a six-month deadline or face a ban.

Visa and Mastercard would rather wind down operations in Russia than comply with the new rules, Kommersant cited an unnamed source close to the international payment systems as saying. The companies themselves declined to comment on the story. Visa and Mastercard's Russian subsidiaries won't be able to comply with the law even if it passes because they are a part of their respective global companies with U.S. headquarters, an independent Russian expert in payment systems who declined to be named told The Moscow Times. "Visa, which is headquartered in San Francisco, and Mastercard in Purchase, N.Y., must comply with American legislation, including sanction orders issued by the U.S. Office of Foreign Assets Control agency," he said. "Amendments to Russian law could result in local offices of international payment systems to be out of compliance, which could lead to problems with Russian cards' acceptance at home and abroad." Russia’s Central Bank told Kommersant it supports the new payment system rules and hopes they will be adopted this summer.
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Go ahead and pass it. Create more hoops your businesses and their customers will have to jump through for credit/debit transactions.

Related: Russia Is No Country for Business – Poll
 
Good news.


As Russia and China inexorably set up alternate payment systems, other states in the world will soon have a real choice.


The US will learn that it doesn't have allies, only states that can't say 'NO' to it.
 
We'll see how well Russia's "payment system" functions without SWIFT.
 
Rogue Valley said:
We'll see how well Russia's "payment system" functions without SWIFT.
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Well, why don't you get on with it instead of making endless threats?


Don't worry .... I think the world already knows exactly what kind of state the US is, so you don't need to worry about your image as a reliable partner.
 
Westphalian said:
Well, why don't you get on with it instead of making endless threats?


Don't worry .... I think the world already knows exactly what kind of state the US is, so you don't need to worry about your image as a reliable partner.
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Says the purveyor of propaganda from a pariah nation, sanctioned by many governments.

Who are your friends?

Belarus, North Korea, China, Cuba, Syria, Venezuela ... all oppressive dictatorships as is Russia.
 
You gonna try again and stick your nose in the Europe forum?

I love seeing you get your arse kicked in there.
 
And I see you're still too embarrassed to list your true location.

East :lamo
 
It couldn't possibly backfire and end up cutting Russia off from the world financial markets.
 
Carjosse said:
It couldn't possibly backfire and end up cutting Russia off from the world financial markets.
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He believes Russians will be satisfied living in Putin-world, a closed world where no credit/debit cards work except Putin-cards.
 
Rogue Valley said:
He believes Russians will be satisfied living in Putin-world, a closed world where no credit/debit cards work except Putin-cards.
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Russian banks can create their own credit cards. Or Russian can go the route of China and use Phone apps to make purchases, (see Alipay or Wechat Pay). China basically skipped over the use of debit/credit cards as the means to make payments for purchases
 
Lord Tammerlain said:
Russian banks can create their own credit cards. Or Russian can go the route of China and use Phone apps to make purchases, (see Alipay or Wechat Pay). China basically skipped over the use of debit/credit cards as the means to make payments for purchases
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If you believe this is optimal in a global economy, go for it.
 
Rogue Valley said:
If you believe this is optimal in a global economy, go for it.
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Never said anything about the global economy.

Just mentioning that Russia has choices other than Mastercard and Visa when it comes to electronic purchases.


I will say the excessive use of sanctions involving Swift, will hasten it's decline in usage and create multiple other means of payments.
 
Lord Tammerlain said:
I will say the excessive use of sanctions involving Swift, will hasten it's decline in usage and create multiple other means of payments.
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There has never been any sanctions involving SWIFT. There doesn't need to be.

Russia has a GDP about that of Texas. A petro-state managed by a siloviki-oligarchy consortium.

Which is why no one, except the poorer nations, have joined Putin's Eurasian Economic Union.
 
Rogue Valley said:
There has never been any sanctions involving SWIFT. There doesn't need to be.

Russia has a GDP about that of Texas. A petro-state managed by a siloviki-oligarchy consortium.

Which is why no one, except the poorer nations, have joined Putin's Eurasian Economic Union.
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Society for Worldwide Interbank Financial Telecommunication - Wikipedia


As mentioned above SWIFT had disconnected all Iranian banks from its international network as a sanction against Iran. However, as of 2016 Iranian banks which are no longer on international sanctions lists were reconnected to SWIFT.[34] Even though this enables movement of money from and to these Iranian banks, foreign banks remain wary of doing business with the country. Due to primary sanctions, transactions of U.S. banks with Iran or transactions in U.S. dollars with Iran both remain prohibited.

Similarly, in August 2014 the UK planned to press the EU to block Russian use of SWIFT as a sanction due to Russian military intervention in Ukraine.[35] However, SWIFT refused to do so. In their official statement they said, "SWIFT regrets the pressure, as well as the surrounding media speculation, both of which risk undermining the systemic character of the services that SWIFT provides its customers around the world".[36] SPFS, a Russia-based SWIFT equivalent, was created by the Central Bank of Russia as a backup measure.[37]

In September 2018 the European Union foreign policy head, Federica Mogherini, proposed the development of a new "special purpose financial vehicle" intended to bypass SWIFT.[citation needed] The seven founding members of this new system are to be Iran, the European Commission, Germany, France, the UK, Russia and China – but not the United States.[citation needed]
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Rogue Valley said:
Has SWIFT ever disconnected from Russia or vice-versa?

No.
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You included global economy, swift is part of it, swift has been included in sanctions on a global level, including threats to use against Russia, my comment was about swift on a global level
 
Lord Tammerlain said:
You included global economy, swift is part of it, swift has been included in sanctions on a global level, including threats to use against Russia, my comment was about swift on a global level
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Such threats were never consummated and summarily rejected by SWIFT governors.
 
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