''We will disable Visa and Mastercard for you.'' Elvira Nabiullina running tests on bankers

Central Bank of Russia has decided to insure small banks from sanctions

''We will disable Visa and Mastercard for you.'' Elvira Nabiullina running tests on bankers Photo: Maksim Platonov

The Central Bank of Russia is preparing protection for small banks in case if their larger partners are disconnected from Visa and Mastercard systems. It has recommended market participants working with payment systems through intermediaries to be reinsured and find additional contractors. Anyway, experts say that the probability of disconnecting banks from international systems is small. Read more in the material of Realnoe Vremya.

As a precaution

The Central Bank of Russia is seeking a way to protect banks from possible sanctions. It has sent out information letters to operators of payment systems and a number of credit institutions asking banks to find a reserve partner to service their cards. This was reported by Vedomosti with reference to five market participants.

According to the publication, the request does not apply to all banks, but only small players — those who work with payment systems not directly, but through partner banks. They are recommended to conclude an additional, reserve agreement, which would provide them with sponsorship in payment card systems. According to the idea of the Central Bank, the reserve contract should be activated only if there is a need to change the bank-partner.

Representatives of the Central Bank confirmed the presence of the letter, adding that it is only a recommendation. The letter was drawn up on the basis of international standards of risk management in payment systems.

Market participants believe that the regulator wants to be safe not only from the collapse of main banks-partners, but also from potential sanctions: namely, from the fact that existing partners may be disconnected from Mastercard and Visa systems. Photo: proficomment.ru

However, market participants believe that the regulator wants to be safe not only from the collapse of main banks-partners, but also from potential sanctions: namely, from the fact that existing partners may be disconnected from Mastercard and Visa systems. Now the largest sponsors of participation in payment systems are non-bank credit organization Platezhny Tsentr, VTB, Promsvyazbank, Rosbank and Uralsib.

Representatives of the industry also say that the process of changing the partner-bank, as a rule, is ''long and painful'' — it can take about three to six months, during which failures in the operation of cards are not excluded. In addition, it can cost the banks about $100,000.

In August-September, the news background related to possible US sanctions against seven Russian credit institutions, five of which are included in the list of system-forming ones, did not decrease. Concerns arose after the introduction of a bill in the US Congress, which implied restrictions on banks for any transactions with the dollar. The bill was referred to Sberbank, VTB, Gazprombank, Promsvyazbank, Rosselkhozbank, Vnesheconombank and Bank of Moscow, in 2016 included in the structure of VTB.

Recently, Head of Sberbank German Gref said that one or two medium-sized Russian players are risking falling under sanctions: according to him, measures against them may be introduced in early 2019.

Recently, Head of Sberbank German Gref said that one or two medium-sized Russian players are risking falling under sanctions

A nice bit of goods

''I can definitely say that effective banks have already long been working with several partners. This is a guarantee of stability — banks that are interested in ensuring uninterrupted payments to customers, go for it without any instructions. Moreover, I know that some banks have contracts not with two, but even with three sponsors, in order to have a serious guarantee of payments,'' says Associate Professor of Finance and Banking of Department at Ranepa Yury Tverdokhleb.

Recommendations of the Central Bank, he said, are addressed to players trying to save, ''I believe that this is not the direction where it is necessary to save.''

As for the prospects of disconnection from Visa and Mastercard, they are unlikely, believes Tverdokhleb, ''Frankly speaking, I do not think this will happen. Because, first of all, payment systems themselves will suffer from this: the tasty morsel such as the Russian financial environment will be lost for them. Common sense dictates that they are unlikely to go for it. I think all these political games have nothing to do with business.''

At the same time, Tverdokhleb admits that in case of a ban on access to international payment systems, it will be ''very unpleasant — even painful'' for Russian banks.

Economist Sergey Khestanov also does not believe in the prospect of disconnection from the international systems. American business, he believes, will not want to lose a large market in the face of Russia.

By Artyom Malyutin