Russia’s invasion of Ukraine has created a strong ripple throughout various industries. As a result, Visa and Mastercard are putting their foot down by blocking multiple financial institutions from their payment networks. A very interesting decision, although one that was bound to happen sooner or later.
Mastercard and Visa Make Their Move
In an unsurprising development, Visa and Mastercard weigh in on the Russia-Ukraine situation. The invasion of a sovereign nation has met tremendous criticism from various leaders and industries. Moreover, Western governments have agreed to exclude Russian banks from the Swift messaging network, making it slightly easier for others to impose similar sanctions.
Mastercard CEO Michael Miebach stated:
“As a result of sanction orders, we have blocked multiple financial institutions from the Mastercard payment network. We will continue to work with regulators in the days ahead to abide fully by our compliance obligations as they evolve.”
Visa took a very similar approach by blocking sanctioned banks from payment rails starting today. However, whether these financial measures will make a meaningful difference in Russia remains unclear. Moreover, it seems unlikely President Putin will order the withdrawal of troops all of a sudden, as nothing has changed on that front.
Other financial players have begun imposing limits for Russian clients. Wise and N26 have very low daily limits in place for transfers to Russia. Paysera is no longer processing transactions tied to Russian accounts for the foreseeable future.