PayPal, MasterCard and Visa have said they will suspend Russian operations in response to Russia’s invasion of Ukraine, making payment processing significantly more difficult.
The three payment giants have now joined a growing list of global entities that have refused to do business with Russia.
The move, in response to a request from Ukrainian President Volodymyr Zelensky on Saturday, is expected to give Russia’s financial sector another push by major card companies and further isolate the sanctions-ridden economy.
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MasterCard, others no longer love Russia
Al Kelly, chairman and chief executive officer of Visa Inc., said in a press release that the company felt compelled to act in response to Russia’s “unprovoked attack on Ukraine and the unbearable events we have witnessed.”
“We have decided to suspend our network services in Russia,” MasterCard said in a statement.
PayPal President and CEO Dan Shulman said in a statement that the company was shutting down in light of Russia’s “violent military intervention in Ukraine.”
The Russian operation is a blow
An important element of the West’s response to the attack is the economic pressure it has exerted on Moscow to break away from the international banking system.
Late last month, the United States and its allies agreed to de-list some Russian banks from the SWIFT secure messaging network, a system that financial institutions around the world use to send and receive money transfer requests.
MasterCard has stated that it will no longer support cards issued by Russian banks and that any cards issued outside the country will be invalid at Russian stores and ATMs.
According to a PayPal spokesperson, the company will continue to offer “one-time” withdrawals to ensure that account balances are distributed in accordance with applicable laws and regulations.
Russian account blocked
Despite demands from Ukrainian officials and lawmakers elsewhere, cryptocurrency companies have resisted calls to arbitrarily restrict all Russian residents.
Jesse Powell, CEO of Crypto Exchange Kraken, said the company would comply with such requests if required legally.
Ukraine has requested that Binance, Bybit, Coinbase, Huobi, KuCoin, Gate.io, Whitebit, and Ukraine-headquarters Kuna limit all Russian cryptocurrency accounts.
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During a phone conversation with US President Joe Biden Zelensky, he praised the decision of the card companies to suspend Russian operations.
According to a White House official, Biden said his administration is pressuring Ukraine to provide security, humanitarian and economic assistance, and is cooperating with Congress to obtain additional financial assistance.
MasterCard and Visa have already agreed to the US and international sanctions imposed on Russia following the February 24 attacks.
Meanwhile, Bitcoin traded at 38 38,531.72 on Sunday, down 1.8% in the last 24 hours.
Featured image from Times of Israel, chart from TradingView.com