Putin ‘sanctions’ Visa, Master Card

  

President Vladimir Putin said today (27 March) that Russia would develop its own credit card system, in order to reduce reliance on Western payment card companies Visa and MasterCard and soften the potential blow from EU, US sanctions.

Putin voiced his support for plans, described by senior officials as a domestic-based system, in response to restrictions placed on Russian banks last week by the American credit card giants.

"We certainly must do this, and we will do it," Putin told senior Russian lawmakers during a meeting that mainly focused on efforts to integrate the Crimea region after he signed legislation to make it part of Russia last week.

Visa and MasterCard stopped providing services for payment transactions for clients at Bank Rossiya last week, under US sanctions over what the West says is Russia's illegal annexation of Crimea (see background.)

The two credit card firms also suspended services for clients at several other banks, whose shareholders are on the US sanctions list. They resumed services after the US government said this did not mean the banks were subject to sanctions.

"It is really too bad that certain companies have decided on [...] restrictions," Putin said, without naming Visa or MasterCard. "I think this will simply cause them to lose certain segments of the market - a very profitable market."

Russia has been largely integrated into the global economy since the 1991 collapse of the communist Soviet Union. But the biggest superpower confrontation since the Cold War has led officials to look for ways to reduce reliance on the West.

After hitting Russian officials and lawmakers with visa bans and asset freezes, the United States and European Union are threatening measures affecting entire economic sectors if Russia continues to escalate the crisis.

Western states have emphasised they do not recognise Crimea as being part of Russia. But President Putin - his popularity boosted by the annexation - has pressed ahead with steps to integrate the territory.

"We must do everything as swiftly as possible so that those who live in Crimea ... feel like fully-fledged citizens of the Russian Federation," Putin told the senior lawmakers.

Crimeans voted to secede from Ukraine and join Russia in a March 16 referendum dismissed as a sham by Western governments, which say it violated Ukraine's constitution, and was held only after Russian forces seized control of the Black Sea peninsula.

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Comments

John's picture

Not a bad idea except if you are a traveller to Russia.

Gerry's picture

Europe should follow suit and develop its own system too, independent and immune from American banks. I mean, why put all your eggs in someone else's basket? Let them take the profits? Show some goddamn independence for once. All we ever seem to do is crawl back on their lap.

Cropper8's picture

John, the Visa and Master Card would be still valid payment option for foreign travellers as well as for Russians, however the wages and and pensions would be processed by the internal Russian system and not by the Visa/Master Card services based in the USA. When going abroad Russians would be prompted to use their Visa/Master enabled cards.

Cropper8's picture

Actually, I am very suprised, considering all that Russia bashing in the West over the last couple of decades, the Russians had not been bothered with creating a system of their own and prefered to rely on an unfriendly partner. It could have been done long time ago.