Russian "Mir" cards are ceasing to operate in Kyrgyzstan as well. The "Interbank Processing Center" CJSC, the operator of the Kyrgyz national payment system "Elcart," has announced that it is terminating its relationship with the Russian NSPK. This is the operator of "Mir" cards, which fell under the latest package of US sanctions.
Starting this Friday, April 5, 2024, Kyrgyzstan will completely cease servicing "Mir" bank cards in its infrastructure. Prior to this, in the fall of 2022, more than half of the country's twenty-plus banks that provided services to users of this card had already abandoned "Mir." Now, Kyrgyzstan is abandoning "Mir" completely.
After receiving notification from Kyrgyzstan, NSPK announced that it would cease all operations in the infrastructure of "Elcart" member banks in advance: as early as April 3.
From April 3, 2024, from 9 a.m. (Moscow time), operations on "Mir" cards issued by any Russian banks will not be carried out in the infrastructure of ELKART member banks. We remind you that the "Mir" payment system has not introduced any restrictions on working with international partners. However, foreign banks and payment systems independently decide whether to accept "Mir" cards in their infrastructure, including taking into account the risk of secondary sanctions.
What does this mean?
This means that any operations with "Mir" cards will be absolutely impossible in Kyrgyzstan:
- card servicing in acquiring devices — cashless payments in POS terminals and cash withdrawals at ATMs;
- card-to-card transfers — for example, a transfer from a conditional Russian "Sber" to a conditional Kyrgyz "MBank" via a mobile application;
- e-commerce — online payments from a card to the accounts of trade and service enterprises (TSE).
The same, accordingly, will not be possible in Russian banks with Kyrgyz cards of the "Elcart" system.
The Kyrgyz national operator explained that it is terminating cooperation "in order to minimize the risk of secondary sanctions" and because "it is taking all necessary measures to ensure the smooth operation of the national payment system and its complete security."
However, this measure severely impacts Russian-Kyrgyz economic ties, as well as remote employees of a number of Russian companies who live in Kyrgyzstan. It also affects Kyrgyz migrants themselves, who often transferred money to their families from Russia specifically through banks. Because of this, for example, Tinkoff even launched a Kyrgyz-language version of its application.
Prior to this, fearing American sanctions, Armenia announced its refusal of "Mir" from March 30. Only the Armenian branch of VTB continues to service these cards, while banks that are part of the Armenian national payment system do not want to receive secondary sanctions.
In Kazakhstan, also a member of the EAEU, several banks have already introduced restrictions on the use of "Mir," including Halyk Bank, the largest in Kazakhstan. That is, without problems and restrictions, only Belarusian banks accept "Mir" cards from EAEU countries outside of Russia.
What to do now?
The Central Bank is already thinking about how to rectify the situation. According to Interfax, the First Deputy Governor of the Central Bank, Olga Skorobogatova, has already raised this issue in the State Duma. One simple way is to open ATMs and a network of POS terminals of Russian banks in countries that are moving away from "Mir."
Despite the fact that the risk of secondary sanctions by our foreign counterparties is defined as significant, we see countries that are working with us to expand infrastructure and will continue cross-border cooperation on this topic. Several countries have 100 percent opened their ATMs and POS terminals, I cannot name them, but they exist, including tourist destinations, where our citizens travel quite actively.
She, according to the news agency, reminded that Russian banks operate in such countries, and work is currently underway to increase the size of their ATM network and terminals. Skorobogatova did not name any specific banks or countries.
Another option is to replenish fintech solutions in foreign countries through the FPS, and this is currently "the most priority scheme, because it technologically carries fewer risks" for counterparties.
Read materials on the topic:
Protect your money — how sanctions affect Russians with "Mir" cards
Samsung Pay removes all Russian "Mir" cards from the application due to US sanctions