Boston, MA, 04/07/2014 (usastockreports) – Mastercard Inc (NYSE:MA) has stayed a dominating player in the global payment services arena. In the recent developments Mastercard cannot provide its purchase payment services in some of the approved banks in the country. This is applicable even after the withdrawal of the suspensions. It is because now Russia doesn’t wants to be dependent on the global payment services arena that can be affected anytime by the U.S. sanctions. To take things it its own hands, Russia is planning to get its own domestic payment system in the coming six months.
The beginning of the problem
All these problems started when the U.S sanctioned some of the Russian Investors. The list included some of the famous names like Boris Rotenberg who is one of the co-owner of SMP Bank. Later the matter became worse when the Mastercard decided to withdraw the credit card purchasing payment services for some of authorized banks. The withdrawal was limited to the credit card purchasing payment services and didn’t have any kind of impact on the cash withdrawal services. Due to the steps taken up by Mastercard, the clients of the affected banks have to face serious problems.
Russia’s course of action
Seeing the current situation, the country had decided to introduce the domestic payment system that will include electronic payment card for its citizens. The card is expected to fulfill two types of transactions- the first government related transactions and the second is private purchase payment.
What the future holds?
Looking at the number of people who use credit cards in Russia, it is clear that Russians don’t like to use credit cards for their transactions. Instead they like to use debit cards for any kind of transactions. It will therefore hardly have any impact on the market share of the Mastercard in Russia. In the long run the company is going to increase its reach in the global market that will help it to cover up the loss of market share made in Russian market.