BEIJING (AP) — China’s credit card processor has refused to cooperate with banks in Russia for fear of becoming the target of sanctions over its war on Ukraine, cutting off a possible alternative after Visa and Mastercard stopped serving them, according to it. Russian news channel RBC.
UnionPay’s decision will affect Sberbank, Russia’s largest commercial bank, and smaller institutions, RBC reported on Wednesday. It cited five unidentified sources at major Russian banks.
Mastercard and Visa have suspended operations in Russia after the United States and other governments imposed trade and financial sanctions on President Vladimir Putin’s government for its attack on Ukraine.
Sberbank and another institution, Tinkoff Bank, have announced that they are considering switching to UnionPay, which is operated by Chinese state-owned banks. UnionPay is one of the largest global payment processors, but does almost all of its business in China.
US officials have warned that governments or companies that try to undermine sanctions will face consequences. RBC said UnionPay wanted to avoid such “secondary sanctions”.
The government of Chinese President Xi Jinping has called Russia its “key strategic partner” and criticized sanctions against Moscow. But Chinese companies and banks appear to be adhering to trade and financial restrictions.
Other banks mentioned by RBC are Alfa Bank, VTB, Otkrytie and Promsvyazbank.
