The payment processors cited Russia’s invasion of Ukraine in announcing the move on Saturday.
Visa, Mastercard and PayPal are all suspending operations in Russia, the companies announced Saturday, citing the country’s ongoing invasion of Ukraine.
Visa will begin working to discontinue transactions in Russia, but it will take a few days, according to a press statement. Mastercard said it would suspend all its network services in Russia, which sent military forces into Ukraine at the end of February.
“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,” said Visa’s statement, which was attributed to global communications vice president Andy Gerlt.
In the press release, Visa Inc. Chairman and CEO Al Kelly said that the company “was compelled to act following Russia’s unprovoked invasion of Ukraine, and the unacceptable events that we have witnessed. 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.”
Similarly, Mastercard said that in addition to blocking some Russian financial institutions, it will end support for any cards issued by Russian banks and block transactions from cards issued outside Russia but used “at Russian merchants or ATMs.”
Earlier on Saturday, Ukrainian Vice Prime Minister Mykhailo Fedorov tweeted a letter sent by PayPal CEO Dan Schulman announcing a similar shutdown.
Spokespeople for PayPal did not immediately return a request for comment, but reportedly told Reuters the shutdown would still “ensure that account balances are dispersed in line with applicable laws.”
Companies have been under public pressure to suspend operations in Russia due to its invasion of Russia. Crypto companies have by and large resisted calls for unilaterally blocking all Russian residents, despite entreaties from Ukrainian officials and lawmakers elsewhere.
Jesse Powell, CEO of crypto exchange Kraken, said the company would do so if legally compelled to (his exchange was not one Ukraine formally asked). Ukraine has asked Coinbase, Binance, Huobi, KuCoin, Bybit, Gate.io, Whitebit and Ukraine-based Kuna to block all Russian accounts.
Russia’s central bank said in a statement that Visa and Mastercard cards would continue to work within Russia after the credit card processors announced their suspensions.
“Operations on them are processed within the country in the National Payment Card System, and sanctions do not affect them,” the central bank said. “Customer funds on accounts linked to such cards are fully preserved and available.”
Cross border transactions are not expected to work.
BY: Nikhilesh De
The leader in news and information on cryptocurrency, digital assets and the future of money, CoinDesk is a media outlet that strives for the highest journalistic standards and abides by a strict set of editorial policies. CoinDesk is an independent operating subsidiary of Digital Currency Group, which invests in cryptocurrencies and blockchain startups. As part of their compensation, certain CoinDesk employees, including editorial employees, may receive exposure to DCG equity in the form of stock appreciation rights, which vest over a multi-year period. CoinDesk journalists are not allowed to purchase stock outright in DCG.