In the wake of Visa and Mastercard’s suspension of operations in Russia, Russia is looking to China’s UnionPay to enable Russians carry out card transactions overseas.
Two of the biggest banks in Russia, PJSC Sberbank and Tinkoff Bank said on Sunday that they are considering the possibility of payment cards powered by China’s UnionPay system. Sberbank, Russia’s largest bank, said it would announce the launch date later. Alfa Bank is already pushing ahead with plans to issue cards using UnionPay
Both banks told their users that Visa and Mastercard cards can still be used for transactions within Russia but they will stop working for payments outside of the country after Wednesday, 9th of March 2022.
Currently UnionPay cards are accepted at physical stores in 180 countries and regions and at online stores in 200 countries and regions.
As at 2020, UnionPay accounted for 32% of purchase transaction volume worldwide.
China has refused to condemn Russia’s invasion of Ukraine and this has now placed the Chinese payment processor UnionPay benefits at a vantage position to be a payment monopoly for hitherto cardholders who do business outside Russia.
China and Russia share close bilateral ties in trade which recorded a rise of 35.9% last year with total trade at $146.9 billion
Some Russian banks already use the UnionPay system, but others will make the switch by issuing cards with both the Chinese system and Russia’s Mir payments system.
