Visa and Mastercard announced this Saturday the suspension of their operations in Russia, so transactions can no longer be made through both platforms.
Foreign citizens will not be able to use their cards to make purchases or withdraw money, while citizens with cards issued in the country will be able to buy within Russia, but their transactions will be made through other networks.
“All transactions initiated with Visa cards issued in Russia will no longer work outside the country and Visa cards issued by financial institutions outside of Russia will no longer work within the Russian Federation ,” Visa wrote in a statement.
For his part, the president and CEO of Visa, Al Kelly, quoted in the note stressed: “We are forced to act after Russia’s unprovoked invasion of Ukraine and the unacceptable events that we have witnessed,” he said.
The decision of both entities comes a week after the United States and the European Union (EU), along with other Western partners, agreed to remove “certain” Russian banks from the Swift international system, which accentuates Russia’s disconnection from the financial system. international.
The Swift transaction system is the foundation of the global financial system and is used by 11,000 banks in 200 countries or territories to make transfers.
Both institutions already announced last week the blockade of Russian financial institutions sanctioned by the US authorities. in retaliation for the Russian invasion.
Kelly stressed that Visa regrets “the impact this will have” on its colleagues, partners, merchants and cardholders, but insisted: “This war and the constant threat to peace and stability require that we respond in accordance with our values.”
Visa specified that the operations will stop in the coming days “once the ongoing operations are completed. “
For its part, Mastercard assured in another note that “with this action, cards issued by Russian banks will no longer be compatible with the Mastercard network and any Mastercard issued outside the country will not work in Russian stores or ATMs.”
The financial company, which has operated for more than 25 years in Russia, also stresses that it has not taken “this measure lightly” and highlights that “for more than a week, the world has witnessed the shocking and devastating events as a result of the Russian invasion of Ukraine”.
According to the trade publication Nilson Report, quoted by The Wall Street Journal, payments made through Visa and Mastercard accounted for 74% of all such transactions in 2020.
The American Bank JPMorgan Chase assured yesterday that it calculates that the Russian economy will contract 7% in 2022 due to the war in Ukraine , twice as much as anticipated a few days ago, as a consequence of the sanctions imposed by the West against Moscow and due to the exodus of international companies in the country.