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Tuesday, October 3, 2023
HomeBusinessBanking & FinanceMastercard, Visa suspend operations in Russia after the Ukraine invasion

Mastercard, Visa suspend operations in Russia after the Ukraine invasion

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Mastercard and Visa are suspending their operations in Russia, the companies said Saturday (local time), in the latest blow to the country’s financial system after its invasion of Ukraine.

Mastercard said cards issued by Russian banks will no longer be supported by its network and any Mastercard issued outside the country will not work at Russian stores or ATMs.

“We don’t take this decision lightly,” Mastercard said in a statement, adding that it made the move after discussions with customers, partners and governments.

Visa said it’s working with clients and partners in Russia to cease all Visa transactions over the coming days. ”We are compelled to act following Russia’s unprovoked invasion of Ukraine, and the unacceptable events that we have witnessed,” Visa Chairman and Chief Executive Officer Al Kelly said in a statement.

The twin suspensions were announced within 16 minutes of each other, and they followed a private video call earlier in the day between President Volodymyr Zelenskyy of Ukraine and US lawmakers.

Earlier in the week, Visa and Mastercard had announced more limited moves to block financial institutions from the networks that serve as arteries for the payments system.

The moves by Mastercard and Visa could make real differences to their bottom lines. Russia accounted for 4 per cent of all of Visa’s net revenue in its last fiscal year, including money made from domestic and cross-border activities. Ukraine accounted for about 1 per cent, Visa said in a filing with U.S. securities regulators this week.

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