Russia Relying on China’s UnionPay System in the Face of Visa and Mastercard Departures

Visa and Mastercard joined a growing number of western financial firms that have declared plans to withdraw from Russia. Looking for alternatives, the nation’s central bank said it has turned to China’s UnionPay system.

  • President Vladimir Putin launched a “special military operation” against Ukraine less than two weeks ago, which still continues until this day with no real endgame in sight for either side.
  • NATO and EU decided not to escalate conflict by engaging directly in military actions. Instead, they opted for a more 21st-century option – imposing all sorts of sanctions against the country, the oligarchs, people around Putin, and ordinary citizens.
  • The Russian Federation’s financial system was the most targeted by many of these measures. One of those was the removal of multiple banks from SWIFT.
  • It was revealed that the major western financial companies would also stop servicing Russians during this weekend.
  • While speculations arise whether locals will turn to cryptocurrencies, given the skyrocketing trading volume since the war started, Russia’s central bank outlined another solution.
  • The institution said that local lenders will be able to use China’s UnionPay system. Founded 20 years ago and headquartered in Shanghai, China, UnionPay (known as CUP or UPI internationally) operates in over 180 countries, according to Russia’s central bank.
  • It’s also worth noting that the organization said UnionPay could work together with Russia’s own payments system – Mir.

 

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