Starting April 5, Kyrgyzstan will suspend the service of cards belonging to the Russian MIR payment system, Russian National Card Payment System (NSCP) reports. This decision comes in response to U.S. sanctions imposed on the NSCP, the entity behind the MIR payment system. Local payment system operator "Elkart" will cease to support MIR cards from April 3.
Background and Decision
The decision to suspend MIR card services in Kyrgyzstan is driven by the need to mitigate the risk of secondary sanctions against the country's payment infrastructure. Consequently, individuals will be unable to withdraw cash from ATMs, transfer funds, or make online payments using MIR cards within Kyrgyzstan.
The integration of the Russian MIR and Kyrgyz Elkart payment systems facilitated the introduction of MIR cards in Kyrgyzstan in 2019. Currently, 21 banks in the country participate in the Elkart system. However, challenges with MIR card operations surfaced in the fall of 2022 when the US Department of the Treasury warned of potential penalties for foreign financial institutions collaborating with NSPK.
Impact and Implications
The suspension of MIR card services in Kyrgyzstan reflects the broader repercussions of geopolitical tensions on financial systems. The move underscores the imperative for countries to navigate complex regulatory landscapes and ensure compliance with international sanctions regimes.
With Armenian banks ceasing services for Russian MIR cards from March 30, the discontinuation of MIR card operations in Kyrgyzstan marks another development in the evolving landscape of cross-border financial transactions.
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