Putin Vows To Create National Payments System

Posted by: : Paul EbelingPosted on: March 28, 2014 Putin Vows To Create National Payments System

Putin Vows To Create National Payments System

V, MA

President Vladimir Putin said Thursday Russia will create its national payment system to secure smooth operations of local banks, in an apparent move to deter “disruptions” from such Western systems as Visa (NYSE:V) and MasterCard (NYSE:MA).

“In Japan and China these systems work successfully. They initially have been created as closed national systems but now they enjoy wider popularity,” Putin told a meeting with the Federation Council, upper house of the parliament.

Russia would create a similar system “by all means,” he said, adding the government and Central Bank have already been working on that.

Mr. Putin said the companies which have frozen processing payments of Russian cardholders will lose lucrative market segments in that country.

His remarks came after international payment systems Visa and MasterCard earlier suspended processing payments by cardholders at Russian banks targeted by the United States under sanctions over events in Crimea.

“We must protect our interests and we’ll be doing that,” the Interfax news agency quoted Mr. Putin as saying.

Currently, some 200-M banking cards are circulating in Russia with 95-M of them being served by foreign payment systems.

Valentina Matvienko, chairperson of the Federation Council, said Russian banks have no control over these systems’ operations and infrastructure.

She said that Russia needs to swiftly adopt a law which would ban localization of the payment systems’ processing centers.

She also urged the creation of Russia’s own credit-rating agencies so as not to depend on those based on foreign governments.

Stay tuned…

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Paul Ebeling

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Paul Ebeling

Pattern Recognition Analyst, equities, commodities, forex
Paul Ebeling is best known for his work as writer and publisher of “The Red Roadmaster’s Technical Report” on the US Major Market Indices™, a highly-regarded, weekly financial market letter, where he enjoys an international audience among opinion makers, business leaders, and respected organizations. Something of a pioneer in online stock market and commodities discussion and analysis, Ebeling has been online since 1994. He has studied and worked in the global financial and stock markets since 1984.
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