Ukraine-Russia crisis: A large number of Russian citizens stood in line outside ATM machines on Sunday. They worried that new Western sanctions on Moscow over the attack on Ukraine would lead to cash shortages and disrupt payments.
Blocking Russian banks from the SWIFT global payments system and freezing the Bank of Russia’s reserves is expected to cause a serious economic crisis, although Russian officials and lenders tried to allay fears. Is.
Everyone running towards the ATM
A St. Petersburg resident said, “Since Thursday, everyone has been running to ATMs to withdraw cash. Some are lucky, some are not getting anything.” Banks stand in long queues outside ATM machines in Russia amid fears of card closures or banks limiting cash withdrawals.
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While the SWIFT action would cut Russian banks’ links with international companies, analysts believe that limiting the use of international reserves to more than $6,300 million could be costly for Russia.
Russia’s national wealth will disappear
Sergei Aleksashenko, former deputy chairman of the Russian Central Bank, said that Russia’s National Wealth Fund would effectively disappear. Sergei now lives in America. He said, “President Putin and former finance minister Kudrin have built it over many years keeping in mind a big war. The war has started and there is no money in it.”
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Banks request – keep calm
Russian banks have appealed for calm, dismissing fears related to the money supply and online payment systems.
Apart from this, the rates offered for foreign exchange have increased. The ruble closed at 83 per dollar on Friday, but some lenders were offering rates above 100 on Sunday.
Russia’s largest lender Sberbank said it does not see any impediments to customer transactions through its and partner payment systems. State Development Bank VEB said that external sanctions will not stop support for projects within Russia.
Not much difference except for use abroad
Otkritie, which received a bailout in 2017 from the central bank, said the new restrictions would not make much difference to its bank cards other than using them abroad.
However, the central bank advised people to carry their bank cards, saying that their mobile payment system may not work at all terminals or online shops operated by one of the five banks under the strict restrictions.
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