MARCH 6: The world’s largest payment solutions providers Visa and Mastercard have decided to suspend their operations across Russia. The move comes a day after Paypal suspended its operations in the country.
With this action, cards issued by Russian banks will no longer be supported by the Mastercard and Visa networks. Cards issued outside of the country will not work at Russian merchants or ATMs. The move is likely to hurt Russian citizens more than the government and is likely to create chaos inside the country in the coming days.
The strategic move directed by Biden administration is aimed at putting pressure from inside Russia on to Kremlin to stop the invasion of Ukraine.
Zelensky also asked for Visa and Mastercard to be suspended from working inside Russia, per @Kevinliptakcnn.
— Kaitlan Collins (@kaitlancollins) March 5, 2022
“For more than a week, the world has watched the shocking and devastating events resulting from the Russian invasion of Ukraine. Our colleagues, our customers and our partners have been affected in ways that most of us could not imagine. noting the unprecedented nature of the current conflict and the uncertain economic environment – we have decided to suspend our network services in Russia,” MasterCard said in a statement.
Mastercard has operated in Russia for more than 25 years and has about 200 colleagues in the country.
“As we take these steps, we will continue to focus on their safety and well-being, including continuing to provide pay and benefits. When it is appropriate, and if it is permissible under the law, we will use their passion and creativity to work to restore operations,” Mastercard added.
The move will make Russians adopt cash as the major mode of transactions in coming months.
Visa issued a similar statement. “We are compelled to act following Russia’s unprovoked invasion of Ukraine, and the unacceptable events that we have witnessed,” said Al Kelly, chairman and chief executive officer of Visa Inc.
— Jacqui Heinrich (@JacquiHeinrich) March 5, 2022
“We regret the impact this will have on our valued colleagues, and on the clients, partners, merchants and cardholders we serve in Russia. This war and the ongoing threat to peace and stability demand we respond in line with our values.”
Visa will work with its clients and partners within Russia to cease all Visa transactions over the coming days. Once complete, all transactions initiated with Visa cards issued in Russia will no longer work outside the country and any Visa cards issued by financial institutions outside of Russia will no longer work within the Russian Federation.
Startups and online commerce companies in the country are going to find it hard to operate with all three major payment systems – Visa, Mastercard and Paypal besides Payoneer, shutting Russia off from their networks.
We received a letter from @Dan_Schulman, CEO PayPal. So now it’s official: PayPal shuts down its services in Russia citing Ukraine aggression. Thank you @PayPal for your supporting! Hope that soon you will open it in for 🇺🇦 pic.twitter.com/RaJxEMSLQe
— Mykhailo Fedorov (@FedorovMykhailo) March 5, 2022