Ukraine's central bank on March 9 asked central banks in Kazakhstan, Armenia, Tajikistan, Vietnam, Turkey, and Kyrgyzstan to suspend all transactions with cards of Russia's Mir payments system, Reuters reports.
In a statement, it said it had asked the banks to stop accepting Mir cards in their ATMs and to make it impossible to use these cards in e-commerce and person-to-person transfers.
The appeal comes in alignment with the already-mounting global financial pressure on Russia.
To the world
Mir, which means 'world' in Russian, is a relatively new payment system for electronic fund transfers established by the Central Bank of Russia in 2017. Mir does not itself issue cards, extend credit, or set rates and fees for consumers; rather, Mir provides financial institutions with Mir-branded payment products that they then use to offer credit, debit, or other programs to their customers.
The development and implementation of Mir was spurred by the imposition of international sanctions against Russia in 2014.
In 2021, the Mir system had gained traction domestically, it was starting to generate its own payments orbit internationally. The flow of Russian tourists to countries across the former Soviet Union and North Asia, as well as Turkey, who started to implement Mir cards, had played a huge part in the success story.
But so too has the system’s cost-effective nature and the drive for financial inclusion across much of central Asia. As regional governments look to reduce cash payments, they are turning to Mir as a means of doing so while promoting financial inclusion.
Mir payments were accepted in 11 countries and, with the exception of Turkey, a lot of those markets, at the time, had quite a low level of card payments.
Cutting ties?
Mir appeared in Kazakhstan almost four years ago when VTB launched its services to accommodate Mir payment system. In April of 2020, Sberbank announced that it had started accepting Mir cards. At the time, Sberbank Kazakhstan included more than 100 branches, 1,000 ATMs and 11,000 POS terminals.
As of yet, banks and companies in Kazakhstan have not addressed the matter of whether the payment system will be stopped.
Earlier this week, major airlines in Georgia and Israel made the news for allegedly accepting Mir payments. Georgian Airways and Israel's El Al issued statements denying the claims.
