After Visa and Mastercard announced that they were suspending all Russian operations, multiple banks in the country announced plans over the weekend to begin issuing new cards using a Chinese operating system.
A group including Russian firms Sberbank, Tinkoff and Alfa-Bank said they immediately pivoted to the Chinese UnionPay card processing system.
In a press conference on Monday, Chinese Foreign Minister Wang Yi said that his country and Russia will work to develop further their “comprehensive strategic partnership of coordination for a new era.” He added that China remains willing to act as a “neutral mediator” between Russia and Ukraine to reestablish peace.
The two major American card companies had announced just one day previously that they would be terminating all Russian operations. Neither Visa or Mastercard will support cards issued by any Russian banks globally. Their cards issued anywhere in the world will also no longer function at any ATM or commercial terminal inside Russia.
Several Russian banks are already using China’s UnionPay, while the major Russian institutions are expected to begin issuing cards “co-badged” with the Russian payment system Mir.
Due to the invasion, thousands of Russians have reportedly been stranded internationally as many nations have closed off their airspace to Russian planes. Meanwhile, Russia has responded by banning flights from its airspace by many of the same countries.
Russia’s central bank had advised Russians currently overseas to withdraw cash as needed from ATMs before the decision to terminate operations by Visa and Mastercard were announced.
Visa CEO Al Kelly issued a statement saying the company is “compelled to act” after the unprovoked attack by Russia on Ukraine and the “unacceptable events” the world has witnessed. Mastercard issued a press statement that said the firm does “not take the decision lightly.”
The corporate announcements were made virtually simultaneously and soon after a private video conference between US lawmakers and Ukrainian President Volodymyr Zelenskyy.
Rep. Brad Sherman (D-CA) said that Zelenskyy asked for assistance from lawmakers in getting Visa and Mastercard “turned off” inside Russia.
Four percent of Visa and Mastercard’s net revenues were generated by their operations in Russia last year.