Adding to sanctions aimed at ending Russia’s invasion of Ukraine, credit card networks Visa, Mastercard, and American Express suspended operations in Russia over the weekend.
While the day-to-day impact on Russians may be limited, the U.S. State Department said the credit card restrictions could cause difficulties for Americans buying airplane tickets out of the country, and advised using cash or alternate credit cards, or having friends or family outside Russia buy their tickets.
The suspensions mean ATM and credit cards issued by banks in Russia won’t work outside Russian borders, and conversely, cards issued outside of Russia won’t work in the country, the three networks said in separate statements. The goal is to influence the war by isolating Russian people and businesses from the international community, and the companies acknowledged there would be unintended consequences.
“We don’t take this decision lightly,” Mastercard said in its statement, indicating it hoped to “restore operations” when it’s appropriate.
“We regret the impact this will have on our valued colleagues, and on the clients, partners, merchants and cardholders we serve in Russia,” Visa Chief Executive Officer Al Kelly said in a statement. “This war and the ongoing threat to peace and stability demand we respond in line with our values.”
Visa and Mastercard cards issued by Russian banks will still work within Russian borders, according to a Sunday announcement by the operator of Mir, a Russian payment processing system that the government established several years ago to help resist previous sanctions. The announcement didn’t mention American Express, though American Express itself only noted the cross-border limitations.
With all the disruptions to the normal financial system, it’s possible that Russian citizens could use cryptocurrency for some transactions, according to Salman Banaei, co-head of public policy at Chainalysis, a cryptocurrency compliance firm. Russian citizens have adopted crypto at relatively high rates, though so far there hasn’t been an increase in transactions there, he said in an email.
The Russian financial system is already reeling after some Russian banks were cut off from SWIFT, an international financial messaging system, as part of a host of sanctions. This reportedly sent Russians flocking to ATMs to withdraw money.
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