Visa and Mastercard have blocked financial institutions from their networks in response to sanctions imposed on Russia following its invasion of Ukraine.
Russia launched an unprecedented invasion of Ukraine last week, prompting the United States and governments around the world to impose a slew of sanctions aimed at cutting Moscow off from the global financial system.
The United States placed a number of Russian individuals and financial institutions on a sanctions list known as the Specially Designated Nationals list last week. It effectively prohibits American companies and individuals from doing business with any individual or entity on that list. On Monday, Washington sanctioned Russia’s central bank.
Mastercard announced on Monday that it had “blocked multiple financial institutions” from its payment network, without naming any companies or individuals. “In the days ahead, we will continue to work with regulators to fully comply with our compliance obligations as they evolve,” the company added.
Visa has also blocked those on the sanctions list, stating on Tuesday that it is “taking prompt action to ensure compliance with applicable sanctions, and are prepared to comply with any additional sanctions that may be implemented.”
Both Visa and Mastercard have pledged $2 million in humanitarian relief funds for Ukraine.
It comes after the United States, Canada, and their European allies agreed on Saturday to remove key Russian banks from the SWIFT interbank messaging system. It means that Russian banks will be unable to communicate securely with banks located outside of Russia.
The Russian ruble has plummeted in value as a result of the broad-based sanctions. Russians have also been queuing in long lines to withdraw cash from ATMs.
Meanwhile, Ukraine’s Vice Prime Minister Mykhailo Fedorov has urged major cryptocurrency exchanges to block Russian users’ addresses.
Because cryptocurrencies are not owned or controlled by a single entity like a central bank, they could become a way for Russians to potentially circumvent sanctions and get their money out of the country.
Binance, the world’s largest exchange, has stated that it will block the accounts of sanctioned Russian individuals but has stressed that it will not “unilaterally” freeze the accounts of all Russian users.
Visa and Mastercard have suspended access to their networks to Russian banks in the aftermath of Russia’s sanctions.
