Visa and Mastercard are suspending their Russian operations, as per the statement and they would no longer handle card operations pertaining to sanctioned Russian banks.
They are now extending that to all card issuers and merchant processors in Russia. With this there will be a big impact on foreigners who won’t be able to use their Visa or Mastercard cards for purchases in the country, whether online or in person.
Russian cardholders are still able to use these cards for purchases in Russia, but their transactions will travel over other networks, mainly Russia’s homegrown payments system, Mir.
Mir is a Russian payment system for electronic fund transfers established by the Central Bank of Russia under a law adopted on 1 May 2017. The system is operated by the Russian National Card Payment System [ru], a wholly owned subsidiary of the Central Bank of Russia.
Russian cardholders won’t likely be able to use their Visa- or Mastercard-branded cards outside the country. “All transactions initiated with Visa cards issued in Russia will no longer work outside the country,” Visa said in a statement.
Western financial institutions have moved rapidly to sever ties with Russia, in some cases going well beyond sanctions on the country’s biggest banks. Their moves have hobbled the country’s economy and cut off Russian citizens and companies from the global financial system.
On the surface it looks like a brilliant move to cripple financial transactions of Russia. But scratch the surface and it will actually mean that US will weaponize its corporations on countries not on same page with them.
Experts says, this is a mad man move and it’s not come from Trump but Biden. A question is on will it have impact on Russia? Yes to some extent.
What effect it will have? It will simply cripple Mastercard and Visa growth in future as many nations wouldn’t want to be hostage of US financial or corporate system.
China has Union Pay, Japan has JCBPay and India has Rupay.
India also has UPI which is out of this world payment system for money transfer inside India and I don’t think anything in the world is even half as good or cheap or reliable. Its eighth wonder of the world.
How foresighted Modi is to implement Rupay and UPI knowing US will someday come to Loggerheads with all rising powers in the world.
UK is a poodle so it doesn’t count. Whereas, Japan rising was still almost a state where US controlled lot of reins.
Soviet Union collapsed and a lot of it due to CIA machinations. So now China showed that it can rise and create a multipolar world and US can’t do much about it.
China created an entire parallel system which will allow it to survive a U.S. inflicted financial Holocaust. It never allowed a Facebook, Twitter, Google, VISA etc to dictate its country’s running.
India should be a natural ally to US being a democracy and 90% Indians having a very favourable view of Americans inspite of some past CIA workings as Indians are pragmatic and understand that it’s interests which dictate foreign policy not friendships or shared system of governance.
But India also has aspirations to be a regional superpower and punch at its desired weight and that can only happen when you are Atmanirbhar.
We have done a lot of things which will make us immune to probable bad days when an AOC or Meena Harris or Kamala Harris or Robin Raphael kind becomes US president and would like to sanction India because Indians didn’t buy Pfizer vaccine or F35 etc.
We can be a US ally but we will never want to be a stooge or sell our sword. PM Modi knows this. Hence even when there were no clouds, he purchased an umbrella.
That Umbrella is Rupay, UPI, parallel to SWIFT system, investing heavily in startup ecosystem, getting into hypersonic space missile club, moving into smartphone manufacturing hub etc.
These are systemic changes and augurs well because India did face vaccine raw material embargo from US when it was suffering the most. India is abstaining because it knows it’s not India’s destiny to be a Geopolitical poodle.
