Russian banks look to China for payment alternatives to Visa and MasterCard

Global Business

Russian banks are worried about an end to the availability of Visa and MasterCard credit cards for payments in Russia.

They are reportedly looking to China for a replacement. The China Union Pay system might be an alternative way to secure transactions after credit card sanctions were imposed on Russia because of the crisis in Ukraine. Tom Barton reports.

Follow Tom Barton on Twitter @TomBartonJourno

Russian banks look to China for payment alternative

Russian banks are worried about an end to the availability of Visa and Mastercard credit cards for payments in Russia. They are reportedly looking to China for a replacement. The China Union Pay system might be an alternative way to secure transactions after credit-card sanctions were imposed on Russia because of the crisis in Ukraine. Tom Barton reports.

Union Pay is trying to make a name for itself as a bank card association, with footholds in the United Arab Emirates, Thailand and Turkey. The system is hoping for 2 million credit and debit cards over the next three years and reportedly has thirty new partner banks in Russia.

Russia’s Private Lait Bank is due to soon introduce China Union Pay. The bank is having tens of thousands of the cards delivered.

Sanctions have raised the prospect, however remote, that Visa and Mastercard transactions may be stopped in Russia.

The online newspaper Gazeta.ru claims that major Russian banks including Alfa Bank, Gazprombank and the Bank of Moscow are preparing to issue the Chinese cards.

However, none of the banks have confirmed that they are actually going to go ahead with the issuance of Chinese bank cards. That’s as Visa and Mastercard still maintain market dominance and huge trust in Russia.

Russia’s largest bank, state giant Sberbank, is reportedly going its own way and pursuing its own payment system called ‘Pro100’.