After Visa & Mastercard Suspend Operations, Russia Seeks Help From China's UnionPay

A day after international financial service providers Visa and Mastercard pledged to cease operations in Russia, several Russian banks on Sunday announced plans to start issuing cards using the Chinese UnionPay card operator system.

On Saturday, Mastercard and Visa had said that they would suspend operations in Russia within the next several days due to the latest Western sanctions related to Russia¡¯s ongoing war with Ukraine.

Aljazeera

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Among the debit and credit cards issued in Russia, Visa and Mastercard cards accounted for 74% of payment transactions in the country in 2020, according to the Nilson Report, a trade publication, as stated by TheWallStreetJournal.

This latest drastic step by these two international payment service providers makes the use of cards issued in Russia outside the country implausible. Likewise, cards that were issued outside of Russia will stop working in Russia.

But Visa and Mastercard are not the first ones to do so. Others brands who are taking harsh moves against Russia include PayPal, Netflix, Intel, Inditex, Airbnb and Rolls Royce, which had announced they were leaving the country's market.

Switching To China¡¯s UnionPay

Reuters

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As per a report by IANS, Russian banks, including Russia's biggest lender Sberbank, as well as Alfa Bank and Tinkoff, issued announcements regarding the switch to UnionPay.

For the uninitiated, UnionPay, also known as China UnionPay, is a Chinese financial services corporation headquartered in Shanghai, China.

Founded in 2002, it received international status in 2005. The company reportedly operates in more than 180 countries across the globe, including Switzerland, Greece, Italy, Spain, Germany, Mexico, Cyprus, Thailand, India, Israel, Portugal, Croatia, Poland, Serbia, Hungary, and Austria.

Some of Russia's banks, like Pochta Bank, Gazprombank, Promsvyazbank, Sovcombank and several other minor banks had been previously working with the UnionPay card operator's system, RT news had reported.

The USA Welcomes The Move

As per a report in Wion News, US President Joe Biden welcomed the decisions of Visa and Mastercard to suspend services in Russia, during a conversation with Ukraine President Volodymyr Zelenskyy.

The White House said in a statement "President Biden highlighted the ongoing actions undertaken by the United States, its allies and partners, and private industry to raise the costs on Russia for its aggression in Ukraine. In particular, he welcomed the decision this evening by Visa and Mastercard to suspend service in Russia¡±.

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