Visa, MasterCard see limited card services in amendments to NPS bill
MOSCOW. April 15 (Interfax) - Visa and MasterCard are concerned about amendments to the bill On the National Payment System (NPS), foreseeing restricted card services for Russian citizens.
"Problems will arise for everybody. Isolating Russia from the rest of the world could bring serious consequences," head of the MasterCard offices in Russia Ilya Ryaby has told the press.
Visa also sees restrictions in the new amendments. Visa staunchly supports the Russian government's initiative to reform the financial-services sector and develop non-cash payment infrastructure, Steven Parker, the company's chief for Russia, the Commonwealth of Independent States, and Southeastern Europe, said in a company statement. But the company is concerned that a number of points in the current version of the bill will prove counterproductive to these efforts, he said.
The Russian State Duma passed the bill in its first reading back in December. The bill has been fine-tuned for a second reading, and now contains items concerning mandatory usage for payments made within Russia, infrastructure located on Russian territory, and a ban on providing information outside of the country about payments made internally. These amendments, offered by head of the Duma's financial markets committee Vladislav Reznik, have caused much dispute.
Reznik himself has said more than once that he sees no obstacles for the operation of international systems in Russia in the amendments.
Ryaby said that the position of Visa and MasterCard is supported by the Finance Ministry and Federal Antimonopoly Service (FAS). "And possibly the Central Bank of Russia," he has said.
MasterCard is not worried about the requirement for the creation of a legal entity in Russia, but the information-provision ban is quite a problem, Ryaby said. It will significantly restrict the range of card-based banking services Russians will have access to, he said.
Furthermore, the ban will interfere with the operations of banks whose operational centers are located abroad, primarily Russian subsidiaries of foreign banks, Ryaby said. If the amendments are passed and become law, the only way out for the banks and payment systems would be building duplicates in Russia of centers that already exist elsewhere, he said, and that would require sizable investments.
"I continue to love Russia, but they are seriously complicating that love for me," Ryaby said.
Visa and MasterCard plan to invest in the development of products and services in Russia, but they say this development could be hampered if the NPS bill as it stands now becomes law. Visa is looking to put $40 million into the development of new products over three years, but has not said in what services it will be investing. MasterCard is not revealing either its projects or the amount of investment.