SHOGO AKAGAWA, Nikkei senior staff writer
LONDON — Ukraine is urging Visa and MasterCard to halt transactions of their credit and debit cards issued by Russian banks, its central bank chief said, a move that it hopes will add further pressure to the Russian regime that is already facing a raft of international sanctions.
Kyrylo Shevchenko, governor of the National Bank of Ukraine, told Nikkei Asia in a written interview, “We look forward to further decisive steps and solutions aimed at restricting the aggressor’s access to the global financial system.” Shevchenko also said Ukraine “highly appreciates the solidarity and support that our international partners are showing today.”
The U.S., the European Union and Japan agreed on Sunday to exclude some Russian banks from the SWIFT payment system that allows cross-border transactions to further squeeze President Vladimir Putin’s regime for invading Ukraine.
Shevchenko said the central bank and Ukrainian President Volodymyr Zelenskiy are now calling on Visa and Mastercard to cooperate as the next step.
Russia has prepared for such sanctions, to some extent, by launching its own payment network, Mir, in 2015. But its own central bank says Mir has only about 30% of market share. U.S. credit cards control much of the rest of the market.
Shevchenko is also calling on Asian countries to align themselves with the West to ramp up pressure on Putin. “Asian countries should impose the economic and financial sanctions similar to those introduced by the United States and the European Union,” he wrote.
At the same time, the central bank is trying hard to keep Ukraine’s financial system working. It has provided funds to ensure sufficient cash at banks. It has also withheld from setting restrictions on fund withdrawals, which could lead to more panic.
Shevchenko, who has no plans to flee Kyiv, was in intermittent negotiations with the International Monetary Fund on Sunday to request emergency funds, according to a central bank official. Under war conditions, with missiles raining down against a backdrop of gunfire, it is a hard job to do. “Our people continue to work in extreme conditions, from shelters, vans, and basements of their homes,” he said.
Like many in the country, Shevchenko remains defiant against Putin’s invasion and said he would fight “for the right to be Ukrainian, for the freedom of our people, and for the future of an independent Ukraine.”
“We are grateful to each country for its solidarity with the Ukrainian people, for its financial and military support. Each of these measures is an important contribution to our victory, a victory of the global system of values, international law, and modern security architecture over the criminal attempt at geopolitical revanchism,” he added.
The West had been pinning its hopes on diplomatic negotiations to avoid war, but Putin had gone ahead with his invasion of Ukraine last Thursday. He stepped up the rhetoric on Sunday by ordering Russia’s nuclear forces to be on “high alert.” Later on Sunday, the EU and the U.S. increased their sanctions on Russia.
Among the new tougher positions: the EU has closed its airspace to all Russian-registered aircraft, blocked half of the Russian central bank’s reserves and banned Russia’s state-owned news outlets Sputnik and Russia Today. The EU will also supply arms to Ukraine, in what the European Commission called a “watershed moment” as the bloc has never directly contributed in this way to a country in conflict.
The sanctions sent the ruble tumbling 29% at one point on Monday, resulting in the Russian central bank boosting its interest rate to 20% from 9.5% to offset the depreciation.
Additional reporting by Tomoyo Ogawa in Tokyo.