Wednesday, October 22, 2014
 
Follow sptimesonline on Facebook Follow sptimesonline on Twitter Follow sptimesonline on RSS Download APP
MOST READ



PARTNER NEWS



BLOGS



OPINION



WHERE TO GO?

19th Century Portraits

History of St. Petersburg Museum: Rumyantsev Mansion

 

Перевести на русский Перевести на русский Print this article Print this article

Visa, MasterCard Required to Pay $3.8Bln Security Deposit to Work in Russia

Published: April 28, 2014 (Issue # 1807)



  • Foreign payment systems will have to leave a security deposit at the Central Bank equivalent to the value of two days of transactions processed in Russia.
    Photo: Vedomosti

The State Duma on Friday passed a law tightening requirements on embattled foreign payment systems Visa and MasterCard and giving them new competition in the form of a national payment system.

Visa and MasterCard have been at the center of a political storm since U.S. sanctions forced them to cut services to two Russian banks in March. Faced with this demonstration of U.S. power, President Vladimir Putin led the charge to restrict their influence and turn the creation of a Russian payment system into a national security issue.

The law passed on Friday will require payment systems to ensure uninterrupted service, and obliges them to pay a security deposit to the Central Bank to guarantee their good behavior.

Foreign payment systems will have to leave a security deposit at the Central Bank equivalent to the value of two days of transactions processed in Russia. Visa and MasterCard together processed $1.9 billion per day last year, meaning that they will together be obliged to relinquish about $3.8 billion to the Central Bank.

The legislation comes into force on July 1, after which payment system operators will begin handing over the deposits in quarterly installments worth 25 percent of one day's transaction volume.

Operators will also have to immediately inform the Central Bank about any stoppages of service and the reasons for them. Employees at companies that violate these regulations will be liable for fines ranging from 100,000 rubles to 1 million rubles ($2,800 to $28,000). The payment system companies themselves will face a penalty of 10 million rubles ($280,000) for every day of suspended service if they are large enough to be classified as nationally significant. Smaller operators will lose 10 percent of their security deposits for each day of interrupted service.

Visa and MasterCard are currently the dominant players on Russia's payment services market — Visa processes about 60 percent of payments in a market that saw transactions worth $740 billion last year. MasterCard accounts for 35 percent of payments.

These companies will also soon face a state-supported domestic competitor. Russia's new payment system will be built under the aegis of the Central Bank, which will gain full ownership over a new company that will operate the system. The Cabinet said last week the new system should be up and running within 6 months.

Visa is already feeling the squeeze — the company warned last week that U.S. sanctions were damaging its transaction volumes, pulling its revenue growth rate down to four-year lows.





 


ALL ABOUT TOWN

Wednesday, Oct. 22


English teachers can expect to receive a few useful pointers today from Evgeny Kalashnikov, the British Council regional teacher, during the EFL Seminar this afternoon hosted by the British Book Center. The topic of today’s seminar is “Grammar Practice.”


Young Petersburgers will get the chance to jumpstart their careers at “Professional Growth,” a job fair and forum featuring more than 40 major Russian and international companies vying for potential candidates for future positions. The forum not only is a chance to network but also to learn more about the modern business world and to understand what it takes to get the job you want.



Thursday, Oct. 23


AmCham’s Public Relations Committee meeting is scheduled to meet this morning at 9 a.m. in their office in the New St. Isaac Office Center.


Sportsmen get their chance to stock up on all kinds of gear at the Hunting and Fishing 2014 exhibition starting today at Lenexpo. Everything from rods and reels to boats, motorcycles and equipment for underwater hunting will be on sale so that any avid outdoorsman can always be prepared.



Friday, Oct. 24


SPIBA’s ongoing “Breakfast with the Director” series continues today, featuring Tomas Hajek, Managing Director of the Northwest Division at Danone Russia. Hajek will be discussing collaborations between businesses from different cultures. The meeting is at 9 a.m. at the Domina Prestige St. Petersburg hotel and all who wish to attend must confirm their participation by Oct. 23.


Get your gong on at “Sounds of the Universe,” a concert at the city planetarium this evening incorporating six different gongs to create relaxing songs that will transport you upwards into the stratosphere. Tickets are 700 rubles ($17).



Saturday, Oct. 25


AVA Expo, the eighth edition of the event revolving around all things pop culture, returns to Lenexpo this weekend. Geeks, nerds, dweebs and dorks will have their chance to talk science fiction and explore a variety of international pop culture. Tickets for the event can be purchased on their website at avaexpo.ru.



Sunday, Oct. 26


Zenit St. Petersburg returns home for the first time in nearly a month as they host Mordovia Saransk in a Russian Premier League game. Currently at the top of the league thanks to their undefeated start to the season, the northern club hopes to extend the gap between them and second-place CSKA Moscow and win the title for the first time in three years. Tickets are available at the stadium box office or on the club’s website.



Monday, Oct. 27


Today marks the end of the art exhibit “Neophobia” at the Erarta Museum. Artists Alexey Semichov and Andrei Kuzmin took a neo-modernist approach to represent the array of fears that are ever-present throughout our lives. Tickets are 200 rubles ($4.90).



Tuesday, Oct. 28


The Domina Prestige St. Petersburg hotel plays host to SPIBA’s Marketing and Communications Committee’s round table discussion on “Government Relations Practices in Russia” this morning. The discussion starts at 9:30 a.m. and participation must be confirmed by Oct. 24.



Times Talk