Visa (V), Mastercard (MA) and PayPal (PYPL) are all suspending operations in Russia, the companies announced Saturday, citing the country's ongoing invasion of Ukraine.
"Once complete, all transactions initiated with Visa cards issued in Russia will no longer work outside the country and any Visa cards issued by financial institutions outside of Russia will no longer work within the Russian Federation," said Visa's statement, which was attributed to Andy Gerlt. global communications vice president.
In the press release, Visa Chairman and CEO Al Kelly said the company "was compelled to act following Russia’s unprovoked invasion of Ukraine, and the unacceptable events that we have witnessed. We regret the impact this will have on our valued colleagues, and on the clients, partners, merchants and cardholders we serve in Russia. This war and the ongoing threat to peace and stability demand we respond in line with our values.”
Similarly, Mastercard said that in addition to blocking some Russian financial institutions, it will end support for any cards issued by Russian banks and block transactions from cards issued outside Russia but used "at Russian merchants or ATMs."
Earlier on Saturday, Ukrainian Vice Prime Minister Mykhailo Fedorov tweeted a letter sent by PayPal CEO Dan Schulman announcing a similar shutdown.
Spokespeople for PayPal did not immediately return a request for comment, but reportedly told Reuters the shutdown would still "ensure that account balances are dispersed in line with applicable laws."
Companies have been under public pressure to suspend operations in Russia due to its invasion of Ukraine. Crypto companies have by and large resisted calls for unilaterally blocking all Russian residents, despite entreaties from Ukrainian officials and lawmakers elsewhere.
Jesse Powell, CEO of crypto exchange Kraken, said the company would do so if legally compelled (his exchange was not one Ukraine formally asked). Ukraine has asked Coinbase (COIN), Binance, Huobi, KuCoin, Bybit, Gate.io, Whitebit and Ukraine-based Kuna to block all Russian accounts.
Russia's central bank said in a statement that Visa and Mastercard cards would continue to work within Russia after the credit card processors announced their suspensions.
"Operations on them are processed within the country in the National Payment Card System, and sanctions do not affect them," the central bank said. "Customer funds on accounts linked to such cards are fully preserved and available."
Cross-border transactions are not expected to work.
UPDATE (March 5, 2022, 23:45 UTC): Rearranges certain paragraphs, adds context, adds Russian central bank statement.
UPDATE (March 6, 2022, 23:59 UTC): Corrects that Russia invaded Ukraine, not itself in paragraph 8.
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