Russian Banking Sanctions
About Russian Banking Sanctions
After Russias invasion of Ukraine in February 2022, Western sanctions targeted the Russian banking system. Major Russian banks including Sberbank, VTB, and Gazprombank were cut off from SWIFT. The Central Bank of Russias foreign exchange reserves, over 300 billion, were frozen. Visa and Mastercard suspended operations in Russia, leaving Russian cards unusable internationally. Russian banks issued Chinese UnionPay cards as an alternative. The sanctions forced Russian banks to pivot to domestic payment systems, including the Mir card and SPFS messaging system. The ruble initially collapsed but recovered after capital controls and high interest rates. The banking sanctions demonstrated the power of financial warfare and accelerated dedollarization efforts by China, Russia, and other countries.
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