Putin Passes Law Requiring $3.8Bln Security Payments From Visa, MasterCard

May 5, 2014 — 20:59
May 5, 2014 — 20:59

International payment systems Visa and MasterCard will be forced to provide Russian authorities with multi-billion dollar security deposits if they wish to continue working in the country beyond July 1, under a law signed by President Vladimir Putin, the Kremlin press service said Monday.

The law on a national payment system, which seeks to guarantee uninterrupted service of payments in Russia by foreign payment systems and prevent them from cutting services to Russian clients, as Visa and MasterCard did in response to U.S. sanctions in March.

Foreign payment systems will be forbidden by the law to unilaterally cut services to Russian clients and require them to base their processing center in Russia. They will also have to leave a security deposit at the Central Bank equivalent to the value of two days of transactions processed in Russia. Visa and MasterCard, which together service about 90 percent of payments in Russia, processed $1.9 billion per day last year, meaning that they will be obliged to relinquish about $3.8 billion to the Central Bank.

That amount will be payable in 8 quarterly payments starting from July 1.

The law also creates the basis for a new Russian national payment system that hopes to compete with the two U.S. companies. This system will be built and run by a new company created under the aegis of the Central Bank.

See also: 

Visa, MasterCard Required to Pay $3.8Bln Security Deposit to Work in Russia

Exhibition

Sergei Eisenstein. Montage of Attractions

Multimedia exhibition about one of the most world-renowned filmmakers of the first half of the 20th century. In his first article on theories of editing he proposed a new form, the “montage of attractions” — in which arbitrarily chosen images, independent from the action, would be presented not in chronological sequence but in whatever way would create the maximum psychological impact. Read more

The Diplomatic Life of Vitaly Churkin

Vitaly Churkin, Russia's permanent representative to the United Nations for more than a decade, died suddenly in New York on Monday.

see more

Meat Market

One of the latest additions to the trendy food court at Danilovsky Market, which has been undergoing a major renovation for the last ...

Remembering Moscow's Man in New York

We look back at some of Churkin’s most outspoken remarks ...

Meat Market

One of the latest additions to the trendy food court at Danilovsky Market, which has been undergoing a ...