Russia has announced it will develop its own credit card payments system after Visa and MasterCard stopped supporting payment transactions for clients at Bank Rossiya as part of US sanctions over Russia’s annexation of Crimea.
“It is really too bad that certain companies have decided on … restrictions,” Russia’s leader Vladimir Putin said. “I think this will simply cause them to lose certain segments of the market – a very profitable market.”
But might the sanctions give UnionPay the chance to step into the vacuum in Russia? The deputy chairman of the Russian parliament’s Committee on Financial Markets said that Rossiya will probably switch to the Chinese payment platform to enable its customers to use the bank’s cards to once again be able to pay for items in shops. (Rossiya’s Visa and Mastercard cards don’t work at home or abroad currently). UnionPay is now the world’s largest card brand with 3.53 billion cards in circulation, says China Business Daily. But any opportunity arising from the sanctions is going to be limited, the newspaper thinks. First, Rossiya Bank is a medium-sized bank, not a leading one – so the payment volumes won’t be huge. And second, nearly half of Russians don’t like using cards for shopping, preferring to pay in cash.
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