London Daily

Focus on the big picture.
Sunday, Aug 10, 2025

Russia Built Parallel Payments System That Escaped Western Sanctions

Russia Built Parallel Payments System That Escaped Western Sanctions

Crimea sanctions spurred Russia to build its own Mir payments network, taking the sting out of Visa, Mastercard exits
Western sanctions have disrupted nearly every part of Russia’s financial system, but there is one big exception.

The domestic-payments system continued to work smoothly after Visa Inc. and Mastercard Inc. pulled out earlier this month. While the card giants’ exit from Russia was viewed as a significant move by many in the West, the reality on the ground was anything but. Most Russian consumers never lost the ability to use their Mastercard- and Visa-branded cards to pay for things within the country.

There were roughly 197 million Mastercard or Visa cards in Russia at the end of 2020, according to the Nilson Report, a trade publication. But behind the scenes, the cards don’t rely on the U.S. networks’ systems to process payments in Russia. For years, they have used a homegrown system overseen by Russia’s central bank.

The National Payment Card System – known by the Russian initials NSPK – runs the financial plumbing that supports card transactions in Russia, even for cards with the Visa and Mastercard logos.

The system was part of Moscow’s eight-year effort to insulate the Russian economy from Western financial pressures. The Kremlin has also aggressively bolstered a private Russian card company, Mir, which is built on NSPK’s infrastructure. More than 100 million Mir cards have been issued since its launch in 2015, according to the Mir website.

The effects of harsh economic sanctions against Russia are already beginning to be felt around the world. Greg Ebb of the Wall Street Journal joins other experts to explain the significance of what has happened so far and how the conflict can transform the global economy. Photo illustration: Alexander Hotz
The resilience of Russia’s payments system is a rare victory for President Vladimir Putin in his financial war with the West. Russia failed to break its dependence on Western imports, and the country was left in dire need of key parts for industrialization. Before the war, Russia had amassed $630 billion in reserves to ensure it could protect the ruble, but that effort was undermined when the United States and the European Union froze the assets of the Russian Central Bank.

“We have provided our national security in the field of payments,” said Alma Obaieva, head of the National Payments Council, a Russian trade association.

The decline of Visa and Mastercard had significant consequences for the Russians: in many cases, their cards now do not work outside the country. The Mir network extends to a few countries besides Russia, most of which are former Soviet republics. Russian officials have held talks in recent days to expand it to Venezuela and Iran, according to reports from state news agency TASS. Some Russian banks have said they are exploring partnerships with China’s UnionPay to issue cards that their customers can use more widely.

However, the inability of Russians to use their cards to withdraw money or make purchases abroad is in line with the Kremlin’s goal of holding assets in the country. Some Russians who fled said cutting Visa and MasterCard played Putin’s favour.

On a call in February to discuss possible Russia sanctions, executives from Visa, Mastercard and other payments companies told Treasury officials that blocking US networks from handling Russian banking transactions wouldn’t be particularly painful, according to people familiar with the matter. They said the sanctions would simply push more transactions to Mir.
Newsletter

Related Articles

0:00
0:00
Close
Street justice isn’t pretty but how else do you deal with this kind of insanity? Sometimes someone needs to standup and say something
Armenia and Azerbaijan sign U.S.-brokered accord at White House outlining transit link via southern Armenia
Barcelona Resolves Captaincy Issue with Marc-André ter Stegen
US Justice Department Seeks Release of Epstein and Maxwell Grand Jury Exhibits Amid Legal and Victim Challenges
Trump Urges Intel CEO Lip-Bu Tan to Resign Over Alleged Chinese Business Ties
Scotland’s First Minister Meets Trump Amid Visit Highlighting Whisky Tariffs, Gaza Crisis and Heritage Links
Trump Administration Increases Reward for Arrest of Venezuelan President Maduro to Fifty Million Dollars
Armenia and Azerbaijan to Sign US-Brokered Framework Agreement for Nakhchivan Corridor
British Labour Government Utilizes Counter-Terrorism Tools for Social Media Monitoring Against Legitimate Critics
OpenAI Launches GPT‑5, Its Most Advanced AI Model Yet
Embarrassment in Britain: Homelessness Minister Evicted Tenants and Forced to Resign
President Trump nominated Stephen Miran, his top economic adviser and a critic of the Federal Reserve, to temporarily fill an open Fed seat
The AI-Powered Education Revolution: Market Potential and Transformative Impact
Chikungunya Virus Outbreak in Southern China: Over 7,000 Hospitalized
French wine makers have seen catastrophic damage to vines that were almost ready to be harvested after the worst fires in more than 70 years burned through the south of the country
US Lawmaker Probes Intel CEO’s China Ties Amid National Security Concerns
Brazilian President Lula says he’ll contact the leaders of BRICS states to propose a unified response to U.S. tariffs
Trump Open to Meeting Putin as Soon as Next Week, with Possible Trilateral Summit Including Zelenskiy
Katy Perry and Justin Trudeau spark dating rumors, joining high stakes world of celeb-politician romances
US envoy Steve Witkoff arrived in Moscow to seek a breakthrough in the Ukraine war ahead of President Trump’s peace deadline
WhatsApp Deletes 6.8 Million Scam Accounts Amid Rising Global Fraud
Nine people have been hospitalized and dozens of salmonella cases have been reported after an outbreak of infections linked to certain brands of pistachios and pistachio-containing products, according to the Public Health Agency of Canada
Karol Nawrocki Inaugurated as Poland’s President, Setting Stage for Clash with Tusk Government
Trump Signals JD Vance as ‘Most Likely’ MAGA Successor for 2028
US Charges Two Chinese Nationals for Illegal Nvidia AI Chip Exports
Texas Residents Face Water Restrictions While AI Data Centers Consume Millions of Gallons
U.S. Tariff Policy Triggers Market Volatility Amid Growing Global Trade Tensions
Tariffs, AI, and the Shifting U.S. Macro Landscape: Navigating a New Economic Regime
Representative Greene Urges H-1B Visa Cuts Amid U.S.-India Trade Tensions
U.S. House Committee Subpoenas Clintons and Senior Officials in Epstein Investigation
Sydney Sweeney Registered as Republican as Controversial American Eagle Ad Sparks Debate
Trump Accuses Major Banks of Politically Motivated Account Denials and Prepares Executive Order
TikTok Removes Huda Kattan Video Over Anti-Israel Conspiracy Claims
Trump Threatens Tariffs on India Over Russian Oil Imports
German Finance Minister Criticizes Trump’s Attacks on Institutions
U.S. Proposes Visa Bond of Up to $15,000 for Some Applicants
U.S. Farmers Increase Lobbying Amid Immigration Crackdown
Elon Musk Receives $23.7 Billion Tesla Stock Award
Texas House Paralyzed After Democrats Walk Out Over Redistricting
Mexican Cartels Complicate Sheinbaum’s U.S. Security Talks
Mark Zuckerberg Declares War on the iPhone
India Rejects U.S. Tariff Threat, Defends Russian Oil Purchases
United States Establishes Strategic Bitcoin Reserve and Digital Asset Stockpile
Thousands of Private ChatGPT Conversations Accidentally Indexed by Google
China Tightens Mineral Controls, Curtailing Critical Inputs for Western Defence Contractors
OpenAI’s Bold Bet: Teaching AI to Think, Not Just Chat
Tesla Seeks Shareholder Approval for $29 Billion Compensation Package for Elon Musk
Nvidia is cutting prices on its RTX 50-series graphics cards after sales slowed and inventories piled up
Ghislaine Maxwell Transferred to Minimum-Security Prison Amid Ongoing DOJ Discussions
U.S. Tariffs Surge to Highest Levels in Nearly a Century Under Second Trump Term
×