Although the chief executive of Bank of Russia's National Card Payment System has been targeted by US sanctions, the head of public relations at UZCARD stated that the payment processing suspension had nothing to do with it. Shortly after the sanctions came into play, Turkish banks Denizbank and Isbank suspended the use of Mir.
UZCARD officials cited by reuters.com stated these technical maintenance procedures involved the suspension of payment processing, as requested by the Uzbek partner bank that carries out payments.
The Russian Mir car payment system is operated by the Russian National Card Payment System, a wholly owned subsidiary of the Central Bank of Russia. While Mir does not actually issue cards, it provides financial institutions with Mir-branded payment products that they then use to offer credit, debit, or other programs to their customers.
In the context of recent EU and US sanctions against Russia, Mir has been promoted as an alternative to Visa and Mastercard, which shut off their Russian networks in February 2022.
In September 2022, Turkey-based lenders Isbank and Denizbank have suspended the use of the Russian payments system Mir to banks, following US sanctions. Isbank officials revealed that they have stopped Mir payments and are evaluating the new sanctions imposed by the US Treasury. They also mentioned that they are keen to comply with national and international laws, regulations, and commercial business principles.
As mentioned by the Washington Post, Russia requested that several state-owned Turkish banks allow correspondent accounts for Russia’s biggest banks and that Russian industrial producers be allowed to operate out of free economic zones in Turkey.
In August 2022, the US Treasury sent a letter to big Turkish businesses warning they risked penalties if they maintained commercial ties with sanctioned Russians.
In September 2022, the Central Bank of Egypt has entered negotiations to join Russia’s Mir card payments system in a bid to improve Russian tourism in Egypt as well as trade ties between the two countries.
According to al-monitor.com, an anonymous source revealed that the Central Bank of Egypt is working with the Egyptian Ministry of Finance to give Egyptian banks access to the Russian Mir payment card system by the end of September 2022. Moreover, the Russian rouble will be on the list of currencies used by these banks and by tourism companies and hotels in order to improve regional tourism.
In the same month, the Central Bank of Iran has taken early steps to join Russia’s Mir card payment system in order to improve regional trade and bypass US sanctions.
Officials from Iran Central Bank cited by russia-briefing.com revealed that their collaboration with Russia would enable financial transactions between the two countries via Mir. Building on this, Iran could transfer money with other member countries via this system in the future.
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