Russia Demands Visa, Mastercard to Pay USD 3.8 B Deposit

Business » FINANCE | May 7, 2014, Wednesday // 09:57| Views: 1116 | Comments: 4
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Bulgaria: Russia Demands Visa, Mastercard to Pay USD 3.8 B Deposit File photo

Russian lawmakers have adopted regulations which oblige US-based credit card companies Visa and Mastercard to pay billions of USD if they wish to operate in Russia.Under the new legislation, a Russian-based system will also take charge of cashless transactions from this year.

This does not bar foreign card operators from providing services in the country, but imposes new requirements, as the Guardian reports.

It international payment systems want to continue operating in Russia, they must also set up their processing center in Russia and place a security deposit in the country's central bank. They are not allowed to freeze client's assets and if they do, the state would withdraw 10% of the deposit each day the ban is in force.

The measure approved by Moscow's Parliament comes after the US imposed sanctions against some Russian banks thus prompting Visa and Mastercard's freezing of services to blacklisted financial institutions.

Visa and Mastercard stopped working with clients of Rossiya Bank and Sobinbank, which were both in the list.

In a statement, Visa said it rendered some of the new legal provisions as "unprecedented" and intended to "work closely with the government in order to resolve these issues."

Mastercard for their part explained Moscow's fresh requirements might cause difficulties for their operations in the country.

Some Russian experts believe the rules could make the financial system of the country "more stable to outside threat", which could involve sanctions, but also cyber attacks.

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Tags: visa, MasterCard, Russia, payment systems, Moscow, sanctions, freeze, assets, banks
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» To the forumComments (4)
#4
Facial - 7 May 2014 // 13:50:18

MC and Visa make 2% of their global sales in Russia. Sorry Russkies, i can see in my crystal ball you poor fuckers carrying loads of cash when you travel abroad.

#3
knocker - 7 May 2014 // 13:43:13

I think you missed the part that they start their own system.
In cooperation with China btw

#2
USSR - 7 May 2014 // 12:34:05

It will hit Russia and its people at most, for VISA/Mastercard Russia is not a very important market. The both operators will rise their charges to cover additional risk and expenses. It is the same as results of Russian trade embargos - the consumer prices in Russia rise but the EU does not even notice any problems. Thank Putin and his bunch of other aggressive idiots who rule your country.

#1
knocker - 7 May 2014 // 12:12:20

Russia - USA 5-0