2 Dec 2022 15:44

Kyrgyz banks deny service to Russia's Mir cards for fear of U.S. sanctions - National Bank deputy head

BISHKEK. Dec 2 (Interfax) - Kyrgyz banks have denied service to Russia's Mir bank cards for fear of sanctions by U.S. fiscal agencies, Kyrgyz National Bank Deputy Chairman Kaiyp Kulenbekov said.

"Kyrgyz banks, which have stopped service for Mir cards, have done so for fear of sanctions by U.S. fiscal agencies," Kulenbekov said at a meeting of the Kyrgyz parliament.

According to him, cooperation with the Mir payment system may harm Kyrgyz banks, as the sanctions may cripple service for their correspondent accounts abroad.

The National Bank did not pressure local banks into the decision to stop servicing Mir cards, Kulenbekov said.

Half of Kyrgyz banks stopped servicing Mir cards by the beginning of November.

There are 23 commercial banks in Kyrgyzstan. Tolubay, Eurasian Savings Bank, Kyrgyzkommertsbank, Capital Bank, Kemeret, RSK, and EcoIslamicBank are continuing to accept Mir cards.

The Kyrgyz banking system has been working with Mir cards since 2019.

The Kyrgyz authorities give much attention to the development of cashless transactions, yet banks make independent decisions on whether to cooperate with a particular payment system or not, the Kyrgyz National Bank said earlier.

The Office of Foreign Assets Control (OFAC) of the U.S. Department of the Treasury warned on September 15 that non-U.S. banks concluding agreements with Russia's National Payment System (the operator of Mir cards) were at risk of circumventing U.S. sanctions by broadening the use of Mir cards outside Russia.