Russia 2025

Market Overview
Payment Organisation	National Payments Council Association. National Payment Card System (NCPS).
Domestic Card Brand	MIR cards, also co-badged Mastercard, VISA, JCB, or UnionPay. Zolotaya Korona “Golden Crown” cards
Market Structure	In 2016, the Russian banks started the domestic MIR card payments system, designed to take on VISA and Mastercard. Sberbank, the Savings Bank of the Russian Federation, dominates the retail banking market, followed by VTB Bank. Mobile wallet apps are offered by all leading Russian banks. The state, CBR and Russian banks setup a FinTech Association for the development and introduction of digital technology solutions. Ongoing and significant consolidation in terms of the number of banks. Increasing levels of state ownership through consolidation.
Notable Market Trends	Contactless rollout: MIR cards, POS terminals, HCE NFC pilots, money transfer card-to-card at ATMs, ‘Huawei Pay, Instant Payments, and Biometric payments. Following the COVID-19 pandemic, B2C e-commerce value grew significantly to reach RUR 5.7 trillion in 2022. The conflict with Ukraine has led to several Western banks and payment schemes either suspending operations or exiting Russia completely.
Major Card Issuers	Sberbank, VTB Bank, Russian Standard Bank, Zolotaya Korona, Alfa Bank.
Major Card Acquirers	Sberbank, VTB Bank, Gazprombank, Russian Standard Bank, UCS, Promsvyazbank, Alfa Bank.
Major Card Processors	United Card Service, MultiKarta (VTB Group), RuCard.

Key Statistics 2023
Population	146.15 million, 3.07 payment cards per capita (active cards 1.73)
Cards	Debit: 394.73 million Credit: 54.55 million Prepaid: 296.78 million Total cards: 746.06 million, thereof bank cards 449.28 million
Card Transactions	Payments: 73.85 billion, value: RUR 136.05 trillion ($1,607.07 billion) Withdrawals: 1.99 billion; value: RUR 35.08 trillion ($414.4 billion) Total: 75.84 billion; value: RUR 171.13 trillion ($2,021.5 billion)
POS Terminals	4,051,733
POS Payments	61.37 billion, value: RUR 56.38 trillion ($666.0 billion)
ATMs	115,059
ATM Withdrawals	1.99 billion, value: RUR 35.08 trillion ($414.38 billion)
Digital A2A Payments	Instant Payments: 3.04 billion; value: RUB 14.35 trillion

Introduction – Payments in Russia

Russia is a semi-presidential republic with an asymmetric federation, spanning 11 time zones across eastern Europe and northern Asia. With over 146 million consumers and a fast-growing e-commerce and FinTech market, Russia is one of the most innovative payment markets in the world, with proactive efforts by banks and government entities to develop biometrics, blockchain services and digital ID services.

One of the striking characteristics is the rapid growth of domestic payment schemes like MIR, which have been developed to challenge the dominance of VISA and Mastercard. In 2023, more than 287 million MIR cards were issued, a 1.6x increase from 2022 driven by the development of the cashback service and the surge in demand for MIR cards following the sanctions against Russia.

A well-developed internet and telecom infrastructure has given Russian consumers easy access to an array of domestic mobile payment services and also Apple Pay and Samsung Pay.

Russia launched its Faster Payments System in 2019, and uptake is rising rapidly due to the proliferation of online bank and mobile-enabled account-to-account funds transfers. In 2023, the number and value of transactions via the Faster Payments System more than doubled respectively, as compared to 2022, to 7.2 billion (2022: 3 billion) transactions worth RUR 31.0 trillion (2022: RUR 14.4 trillion).

In contrast to western European banks, Russian banks are making progress in forming their own digital payment ecosystems comprising merchants and services in a wide array of sectors such as entertainment, travel, and shopping.

In the last decade, Russian consumers have embraced mobile devices such as tablets, smartphones, and the Internet of Things (IoT). This change significantly impacts their shopping experience. Consumers have become increasingly connected and they have started to purchase anywhere, at any time, from any device.

In addition, new consumer demands are a game changer. Russian consumers like digital banking apps with access to all their accounts at different banks in one single app, with the option to make payments directly from their bank account of choice. Additionally, they appreciate more banking services and payment services added to their mobile banking app. Consumer adoption of digital payments in Russia is driven by minimal cost, secure payments, and a high level of user convenience.

Driven by the development of social media and mobile devices, the emergence of permanently connected consumers has impacted their interactions with brands but also their expectations of how to shop using the increasing number of touch points between consumers and merchants, e.g.:

• Using mobile devices in-store to look up products or additional information on the internet
• Using mobile devices in-store to shop at the same merchant or online at another merchant
• Using mobile devices to purchase at home in online shops or scan outdoor for advertised products
• Using mobile apps to shop online, or using QR-codes to bridge from merchant posters to their online shops

The ongoing rollout of a mature online and mobile communication infrastructure is an enabler for digital card payment transformation in Russia.

In a few years from now, mobile banking apps and mobile payment apps are expected to combine account management, digital payment services, personal finance management and value-added digital services from location finders to digital vouchers.

Cash payments, card payments and cardless payments directly from bank accounts (A2A payments) remain all relevant for Russian merchants and are heavily used by Russian consumers.

This country profile provides an introduction into two competing payment ecosystems in Russia.

• Card payment ecosystem
• Cardless payment ecosystem

The Russia-Ukraine Conflict – On the 24th of February 2022, Russia invaded Ukraine, a significant escalation of the conflict which began in 2014 when Russia invaded and annexed Crimea, and Russian-backed separatists seized part of the Donbas region in south-eastern Ukraine. Ukrainian president Volodymyr Zelensky enacted martial law and a general mobilisation of all male Ukrainian citizens between 18 and 60.

As a result of international sanctions against Russia, Russian-owned banks, money transfer companies and other payment-related entities have been penalised and many have begun the process of exiting western markets or disposing of their subsidiaries in other countries. International payment services, such as Visa, Mastercard and PayPal have either suspended operations in Russia or pulled out altogether. Remittances between Russia and other markets have been impacted. Russia’s government, central bank, regulators, and financial institutions have striven to keep banking and payment operations running as normal, and as of mid-2024, Russians can still access and use most forms of domestic payment methods, such as the MIR card scheme.

*CAVEAT: As of late-2023 when this report was compiled, some central bank, commercial bank data, and payment statistics had not been made available, but all efforts have been made to source credible data from third parties where possible. Where data is missing, estimates have been made in line with previous growth patterns.

Biometric Authentication Services

As a form of digital identity, biometric factors have been gaining ground across Eurasia in recent years, mainly due to the prevalence of national identity cards across many countries.

In the payments industry, Eurasian banks and other account servicing payment service providers (ASPSPs) have started to support new biometrics technology companies that will develop client identification and authentication systems. They will be dedicated to the research and development of software for the digital verification and authentication of personal identity, through facial, voice, image or document recognition, or fingerprint reading.

Biometric authentications look set to grow further in importance as part of the payments landscape.

Among others, in 2024, payments-specific biometric initiatives and pilots in Eurasia include:

• Unlocking mobile wallet apps using biometric ID technology
• Biometric in-app authentication and biometric logins for one-click access to financial services
• Biometric in-app authentication of Apple Pay payments
• Contactless biometric cards that include an integrated fingerprint biometric sensor in parallel to PIN authentication
• Biometric authentication of cash withdrawals at ATMs using biometric finger vein scanners
• Finger vein recognition technology to authenticate users at the point-of-sale
• Lock-screen payment functionality and biometric authentication via Touch ID added to mobile app platforms

Biometrics-based Digital Platform UBS – In February 2018, telco Rostelecom and three Russian banks presented the Unified Biometrics System (UBS) platform developed at the request of the Bank of Russia and the country’s Ministry of Digital Development, Communications and Mass Media.

The UBS combines voice and facial recognition based on a photographic image to provide precise identification of a person. For each identification parameter, the system uses biometric solutions from a number of vendors.  Its security mechanisms will deny authentication if the match score against the reference biometric data stored in the UBS is too low.

In July 2018, Russian banks began the rollout of the UBS. Customers had to enrol in person at a participating bank, after which the bank registered them in the Unified Identification and Authentication System (ECIA) and sent their voice and face biometric data to the UBS. A remote ID mechanism was also introduced, enabling the remote opening of accounts and provision of loans and transfers through the most popular remote service channels, including Android and iOS mobile apps.

As of 2023, there were more than 180 banks, more than 12,000 bank offices collecting biometric data in the Unified Biometric System (UBS). 87 banks provide remote identification services through a website or a mobile application. In 2021, nearly 76,000 new users registered in the UBS. To increase the demand for the UBS, a law prepared with the participation of the CBR has mandated banks with a universal licence to open accounts and issue loans to clients using identification via the UBS beginning on 1 September 2022. Furthermore, the authorities introduced amendments to the legislation allowing individuals to register in the UBS on their own through a mobile app.

In 2021, the CBR continued to implement digital infrastructure projects aiming to enhance the quality and accessibility of financial services, promote competition and innovations in the financial market, and reduce costs. One such project is the Digital Profile. It enables credit institutions, insurers, microfinance organisations, and financial platform operators, upon people’s consent, to receive 38 types of information about them from government sources that are needed to deliver remote services. This provides more opportunities to reduce costs for businesses and clients. There are 34 institutions, including nine systemically important banks, that provide services using the Digital Profile. Citizens used the Digital Profile more than 9.1 million times in 2021.

In 2023, 66 banks, 8 insurance companies, 29 microfinance organisations, and 3 financial platform operators used the Digital Profile to provide the following services: filling out a credit questionnaire and/or receiving a loan, including mortgage loans, getting insurance services (including the purchase of CMTPLI and comprehensive and collision insurance policies), receiving microloans and financial platform services. The Digital Profile supports 37 types of data. After the launch of the Digital Profile, people gave their consent to provide data through this infrastructure more than 55 million times. The SME Digital Profile was created in 2022.

Banking Sector

Established in 1990, the Central Bank of the Russian Federation (CBR) is an independent institution operating in accordance with the Constitution of the Russian Federation and the Federal Law of the Central Bank of the Russian Federation. The CBR supervises the banking sector within Russia.

In April 2018, the financial regulators of Russia, Armenia, Belarus, Kazakhstan, and Kyrgyzstan held a Joint Payment Area Working Group meeting to discuss key trends and initiatives related to the use of innovative financial technology to develop and promote today’s services across the Eurasian Economic Union (EEU). Among others, they denoted blockchain and instant payments as key priorities.

After contracting by 2.8% in 2015, the Russian economy experienced another year of recession in 2016. After GDP decline by 0.2% in 2016, GDP grew by 1.5% in 2017 on the back of recovering domestic demand, mainly through household consumption and investment. According to the CBR, growth was 2.5% in 2018 but declined to 2.0% in 2019 due to falling oil prices and export demand. GDP for 2020 was expected to be in the range of 1.8%, but the economic impact of the COVID-19 pandemic in 2020 brought unprecedented large-scale restrictions on economic activity. GDP contracted by 2.7% in 2020, mainly due to lower global demand for energy commodities and oil production cuts.

Domestic demand contracted due to the reduction in consumption and gross fixed capital formation. Annual inflation sped up to 4.9% in 2020, largely affected by the economic consequences of the pandemic, including ruble depreciation, higher global prices for food products, disruptions in production and logistics chains, and increased costs.

In 2021, the CBR’s monetary policy aimed to contain inflation which soared both in Russia and worldwide due to anti-pandemic restrictions, disruptions in production chains, and expansionary economic policy. GDP growth rebounded to 4.7% in 2021, compared to a fall of 2.7% in 2020, while inflation rose to 8.4% in 2021, compared to 4.9% in 2020.

In 2022, Russia’s economy shrank by 2.1% on the back of its invasion of Ukraine and the subsequent sanctions, although reporting a much less contraction than expected. The decline in GDP was expected to persist in 2023 with forecasts ranging from -0.2% (World Bank) to -2.5% (OECD). However, GDP growth exceeded expectations as the economy grew by 3.6% on the back of increased domestic demand. Russia’s isolation from the global economy is, however, evident in the decline in the share of exports, which corresponded to just 23 % of GDP in 2023 – the lowest level in the current GDP statistical series starting in 1996.

In 2022, inflation edged up to 11.9% from 8.4% in 2021, staying comfortably above the 4% target. The price of Services increased the most, by 8.2% to 13.2%. Annual inflation in Russia stood at 7.4% in 2023, down from 11.9% in 2022.

The 2008 global financial crisis resulted in the closure or acquisition of many of the country’s smaller banks. The government has publicly stated that it would like to see the number of banks operating in the country cut to 300 from the 561 banks operating in 2017. As of 1 January 2021, the number of liquidated credit institutions decreased for the first time since 2014, amounting to 379. Between 2013-2021, more than 450 banking licenses were revoked. The number of banks undergoing financial resolution, with the engagement of the Deposit Insurance Agency (DIA), decreased from 15 to 13 in 2021, with two banks being affiliated to their investors in order to make the financial resolution process more efficient. In 2022, the trend towards reduction in the number of liquidated credit institutions continued, their number decreased to 339. However, in 2023, the trend of reducing the number of liquidated credit institutions continued, their number decreased to 318.

As of January 2022, the CBR owned the shares of Bank FC Otkritie, Moscow Industrial Bank and NB Trust Bank. As a result of a first price sealed-bid auction 100% of Asian-Pacific Bank’s shares were sold by the CBR to Pioneer Capital Invest for RUB 14 billion. The CBR Bank is developing a strategy for exiting the capital of the Otkritie and is exploring possibilities of a sale to strategic investors and in an IPO.

Long-standing sanctions imposed by the EU and US against Russian state-owned companies and banks remained in place throughout 2021. At the end of February 2022, as conflict with Ukraine broke out, the economic situation altered dramatically. Foreign states drastically strengthened the sanction pressure, firstly on the financial sector. The largest Russian financial institutions were cut off from the world financial system, and international payment systems terminated their operations in Russia. As of March 2022, the CBR addressed changes in economic policy due to the conflict with Ukraine, noting that there had been a dramatic strengthening of sanctions which had tested the resilience of the Russian economy and financial system, prompting extraordinary measures.

By 2023, the EU expanded and strengthened enforcement of its sanctions against Russia by increasing vigilance for potential Russian export control evasion while the U.S. Department of the Treasury’s Office of Foreign Assets Control (OFAC) imposed sweeping new Russia-related sanctions and export controls on the architecture, engineering, construction, manufacturing, and transportation sectors of the Russian Federation economy.

In June 2024, the EU launched 14th package of sanctions against Russia, targeting high-value sectors of the Russian economy such as energy, finance and trade and making it increasingly difficult to circumvent EU sanctions. By September 2024, the Council decided to prolong the restrictive measures targeting those responsible for undermining or threatening the territorial integrity, sovereignty and independence of Ukraine for another six months, until 15 March 2025.

Structure

Structure – The Russian banking sector is highly concentrated on a few large national banks. As at end-2023, there were 324 registered banks, down from 440 in 2018. 22 of these banks were state-controlled, 50 banks were foreign-controlled, and 106 were small banks with a basic licence, down from 123 in 2020. This process of consolidation accelerated when the minimum capital requirement was set to RUR 300 million on January 1, 2015.

Two-thirds of the banks in Russia hold universal licences (they account for over 95% of total assets in banking), while the remaining banks have basic licences.

Due to the optimisation of regional networks and the use of new financial instruments and technologies, the number of credit institution branches decreased and as of 1 January 2024 amounted to 411.

In contrast to CEE countries, the involvement of western banks in Russia remained comparatively small. From 2014, foreign banks in Russia changed their focus tending to return to ‘boutique-type’ banking, the status quo before the boom years of 2004 to 2013. Société Générale Group (F) was the biggest foreign investor in Russia’s banking sector, owning a 99.95% stake in Rosbank.

In April 2022, Société Générale ceased its activities in Russia and signed an agreement to sell Rosbank to Interros Capital, the previous shareholder of Rosbank. The sale was completed in May 2022.

1 - Analysis of Credit Institutions in Russia
Operating Credit Institutions	2019	2020	2021	2022	2023
State-controlled banks	22	22	22	22	22
Foreign-controlled banks	50	50	50	50	50
Large and medium private banks	170	167	172	170	170
Banks with a basic licence	136	123	112	106	106
Banks under resolution	24	15	13	12	12
Total banks	402	377	369	326	324
- thereof credit organisations issuing cards	297	253	246	235	229
- thereof credit organisations acquiring payment cards	277	231	220	215	214
Non-bank credit institutions	40	40	37	35	37
Total credit institutions	442	417	406	361	361
Number of branches	618	530	471	453	421
Note: some CBR data for 2021 and 2022 was not published. Therefore figures from various sources are indicative only.
Source: Central Bank of Russia.

The 3 biggest banks – Sberbank, VTB Bank and Gazprombank – are state-controlled or, in the case of Gazprombank, parastatal – and dominate the Russian banking sector, accounting for 72.85% of total banking assets at end-2023. The state-owned Russian Agricultural Bank accounted for another 3.19% of total banking assets. Systemically important financial institutions account for 77% of total assets of the Russian banking sector. The remaining banking sector assets are distributed among smaller banks operating on a regional level.

2 - Main Banks in Russia end-2023
Bank	Ownership	Assets ($bn)	Market Share (%)
Sberbank	State (CBR): 50%+1 voting share, investors	775.4	39.16%
VTB Bank	State: 60.93%, investors	435.6	22.00%
Gazprombank	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others	231.7	11.70%
Alfa Bank Group	State-owned: 92.2%	80.1	4.04%
Russian Agricultural Bank (RusAg)	State: 100%	63.2	3.19%
Vnesheconombank (VEB)	State: 100%	48.3	2.44%
Promsvyazbank (PSB)	State via Central Bank of Russia, nationalised by fiat 2019	41.0	2.07%
Raiffeisenbank	Raiffeisen RBI Group (A)	47.6	2.41%
Rosbank	Société Générale (F): 99.95%	31.1	1.57%
UniCredit Bank	UniCredit Group (I):100%	17.8	0.90%
Russian Standard Bank (RSB)	Russian Standard Corp.: 99.92%	5.0	0.25%
other banks		708.6	35.78%
Total		1,980.3	100.00%
Market share of systemically important top-20 banks (12)		1,524.8	77.00%
Note: assets are as at 1 Dec. 2021 apart from VEB (end-Q1 2021), PSB (end-2020) and RSB (end-2020); total assets approximately $1,615.8bn at year-end; exchange rate of $1: RUR 73.65
Note: VTB purchased Okritie FC Bank by end-2021.
Source: CBR, Yearbook research.

Sberbank, 50% (+1 voting share) owned by the CBR, dominates the banking sector. Its total assets were $775.4 billion as of December 2023, equivalent to 39.16% of the total assets of the Russian banking system. As of end-2020, Sberbank Group had five subsidiary banks in Kazakhstan, Belarus, Ukraine, Sberbank Europe, and Cetelem Bank. Sberbank claimed to service 21 countries worldwide, with 108.5 million active retail clients in Russia, and 3.2 million corporate clients in Russia. Despite its nationwide network, Moscow, and European Russia account for most of Sberbank’s assets. Its Russian network comprised over 12,000 branches at end-2023.

Having developed retail banking networks in Belarus (BPS-Bank), Kazakhstan and Ukraine, Sberbank made its first move into Europe in July 2011 with an offer to purchase the eastern European network (including Croatia, Czech Republic, Slovakia, Hungary and the former Yugoslavia) of Austria’s Volksbank International. The transaction was completed in February 2012 for a final consideration of €505 million and VBI is now called Sberbank Europe.

In June 2012, Sberbank took advantage of the break-up of Dexia to buy 99.85% of Denizbank, Turkey’s sixth-largest private bank, for TL6.5 billion ($3.6 billion). Denizbank is Sberbank’s most significant interest outside Russia. In 2020, Sberbank announced it would rebrand as “Sber”, to reflect its move away from traditional banking towards digital and fintech services.

During 2023, the number of Sberbank retail clients reached 108.5 million (+1.5 million from 2022), with the youth segment becoming Sberbank’s fastest growing client segment. The number of active corporate clients reached 3.2 million, up by about 200,000 from 2022.

In digital banking, Sberbank reported in 2021 that 54% of its clients were digital-only. The number of digital monthly active users was 81.9 million in 2023, a growth of 3.3 million from 2022.

The year 2020 saw Sberbank rebranding as Sber, to represent its evolution into a digital banking and payment ecosystem hub, comprising over 50 companies in the e-commerce, B2B and mobility sectors. The number of SberPrime financial service ecosystem subscribers reached 10 million in 2023, from 5.7 million in 2022, with 9.1 million monthly active users. The growth in the number of subscribers was due to updates to the contents of the SberPrime and SberPrime+ subscriptions. The majority of companies in the Sber ecosystem accept payments through the mobile payment service, SberPay.

In 2021, Sberbank reported that 80% Russia’s youth aged between 14-21 years were clients of the bank. In e-commerce, Sberbank reported growth of 30%, with gross merchandise value growing to RUB 63 billion, compared to RUB 6 billion in 2020.

3 - Sberbank Remote Channel Clients
(millions)	2019	2020	2021	2022	2023	GR 22/23
Number active remote channel clients	69.9	69.9	69.9	74.8	108.5	45.05%
of which:
App average monthly users (m)	54.7	73.0	76.1	78.6	82.6	5.09%
App average daily users (m)	24.7	32.4	38.8	40.9	43.3	5.87%
Active corporate digital users (m)	2.2	2.3	2.3	2.3	2.3	0.00%
Note: the above figures are for unique active clients who are able to use various remote channels.
Source: Sberbank.

Sberbank joint venture with Yandex – In May 2017, Sberbank and Yandex partnered to create an e-commerce venture on the Yandex.Market e-commerce marketplace. Sberbank invested $500 million in Yandex.Market. The companies own equal stakes in the venture while up to 10% of its shares are allocated for an equity incentive program for Yandex.Market management and employees. The Yandex.Market platform has more than 4 million daily visitors and supports over 25,000 domestic and international merchants and 200 million product offerings. Sberbank had a close relationship with Yandex through a previous money transfer joint venture Yandex.Money. The companies launched two new services in 2019: an online marketplace, called Beru, offering a wide range of products from electronics to pet food, and Bringly, a cross-border shopping platform.

However, in June 2020, Yandex severed ties with Sberbank after a 10-year partnership in order to pursue its own fintech ambitions in Russia. Yandex spun out its payment platform Yandex.Money and agreed to buy out Sberbank’s 45% share in Yandex.Market.

VTB Bank – Established in 1990 as the Bank for Foreign Trade of the Russian Federation, state-owned VTB (previously Vneshtorgbank) has since transformed itself into a universal banking group, though the state remains the controlling shareholder with 60.93% of the shares.

Like Sberbank, VTB has expanded through M&A activity. VTB took control of fifth-ranked Bank of Moscow, previously controlled by the Moscow city authorities, in 2011 and by end-2014, its shareholding was 96.88%, while in October 2012 its stake in TransCreditBank (TSC), previously owned by Russian Railways, reached 99.6%. TCS Bank was merged into VTB24 at end-2013, and Bank of Moscow was merged into VTB Bank Group in May 2016. The legal merger of VTB Bank and VTB24 Bank completed in January 2018.

Established in 1995 at the initiative of the government of the city of Moscow as an open joint-stock company, the Bank of Moscow was controlled by the city’s long-serving mayor, Yuri Luzhkov. Following his deposition in 2010, VTB began the process of acquiring a majority stake; however, because of bad debts in the bank, VTB was forced to seek a loan of RUR 295 billion from the Deposit Insurance Agency.

VTB Bank offers retail banking services through its specialised retail bank VTB24. It has expanded outside Russia and, as at end-2023, VTB Group reported that the number of retail customers in Russia reached 19.3 million, an increase of 2.3 million customers over the year, and the number of SME customers grew by 0.3 million to 1.3 million businesses during the year.

As of 2023, VTB serviced customers through 1,900 branches and 19,000 ATMs, and claimed operations in 13 countries abroad including subsidiary banks in Germany, the UK, Angola, Armenia, Azerbaijan, Belarus, Georgia, and Kazakhstan, through representative offices in Italy and China, through branches in China and India, a branch of VTB Bank in Austria, and a branch of VTB Capital in Singapore. In 2022, VTB Group took the first blow among Russia’s largest financial institutions to be affected by the toughest restrictions with its foreign assets frozen and foreign subsidiaries deconsolidated. However, in 2023, the bank seemed to be recovering from the impact of the sanctions.

In October 2012, VTB established Leto Bank to operate in the mass and lower-mass retail market. Leto aimed to recruit several million customers within a few years and to develop a retail network with 1,000 outlets in three years, as well as “several thousand” offices inside stores; by end-2013, Leto was reported to have increased VTB’s customer base by 500,000. In 2016 VTB sold 50% of Leto Bank to Russia’s Postbank to create a new national lender.

In March 2016, VTB Group joined the China International Payment System (CIPS). The People’s Bank of China (PBoC), the Chinese central bank, developed CIPS as an independent cross-border payment and clearing system for the Renminbi (RMB). In 2017 and 2018, the group adopted a strategy of exiting underperforming geographies and segments, disposing its operations in France and Armenia, and consolidating its branch network in Russia (currently 1,700 branches.)

In 2023, VTB Group reported that the number of active retail customers had increased by 2.3 million to 19.3 million, as its retail business recovers from heavy sanctions. At the same time, the number of payroll customers increased by 10% to 8 million at 100,000 companies. This represents a growth of 500,000 customers compared to 2022. VTB kicked off payroll services for SMEs in its VTB Business Lite app. The service will help accountants of such payroll customers make all the necessary transactions to pay salaries. In 2022, VTB won a Frank Payroll Award as the best bank for lending to payroll customers in terms of attractive rates and preferential terms of service.

Gazprombank (GPB), founded in 1990 by Gazprom to provide banking services for gas industry enterprises, was the third largest Russian bank by total banking assets at end-2020, and has diversified from its corporate roots into retail banking, including payment cards. With 3.2 million retail customers, its retail banking business is focused on the employees of corporate customers and individuals with middle- and high-income levels. However, corporate banking, accounting for 61,000 clients, remains Gazprombank’s core business. As of 2020 Gazprombank had a network of 43 branches, over 4,500 ATMs and 420 banking outlets in Russia.

Gazprombank’s base of active retail customers exceeded 3.2 million people for the first time in 2020. 882,000 new customers were attracted in 2020.

In 2020, Gazprombank announced it had made a huge technological step toward the integration into the unified Russian technological environment with the OpenAPI specification being completed. Together with the omni-channel services, it became the basis for Gazprombank’s ecosystem.

Russian Agricultural Bank (RAB, Rosselkhozbank) is the other large state-owned bank. RAB provides financial services to agribusiness, which remains a significant sector of the Russian economy, and to the rural population, which makes up 30% of the total population. RAB reported more than 6.6 million clients in 2023 served in 65 regional branches, 1,338 additional offices and more than 14,000 access points covering the country’s rural areas. More than 74% of the Bank’s branches are located in communities with less than 100,000 residents.

Alfa Bank, controlled by six Russian businessmen, is the biggest private-owned Russian bank measured by total assets, total equity, customer accounts and loan portfolio, and the only one in Russia’s top five. In Russia, Alfa Bank reported an increase of 7.5 million bringing its active retail customers to an estimated 29.5 million active retail customers in 2022, and 1.0 million SME clients.

Direct shareholders of Alfa-Bank are JSC «AB Holding» (around 99.9%), and Alfa Capital Holdings Ltd. (CY) (around 0.1%). Indirectly, Alfa Bank Group is owned by six Russian individuals and the Italian UniCredit Group (9.9%).

In October 2014, Alfa acquired a stake of over 88% in the distressed Baltiyskiy Bank, with 2.6 million customers and 1,181,000 cardholders, potentially lifting its customers to over 3 million. Alfa said it expanded its footprint during 2013, with the number of full-fledged offices rising 20% to 270. Alfa Bank also owns banks in Belarus, Kazakhstan and Ukraine.

In September 2015, Alfa Bank agreed a deal with Austrian Raiffeisen Bank International to buy RBI’s direct banking subsidiary Zuno. Launched in 2010, Zuno had 250,000 clients in the Czech Republic and Slovakia.

In March 2018, Alfa-Bank was the first Russian bank to join the R3 Blockchain Consortium.

During 2020, Alfa Bank stated that the pandemic and technological change justified its efforts to invest in digital infrastructure many years ago. Before the pandemic, 85% of its clients regularly used the Alfa Bank mobile app, and it  enabled small and medium businesses to open accounts remotely.

By H1 2020, despite the pandemic, Alfa Bank launched a network of “phygital” branches where clients receive personal contact and quality digital services after being identified biometrically. Phygital branches use facial recognition to identify clients, and the system provides branch staff with all the relevant information, including the client’s name, bank services used, and what they may be interested in. According to Alfa Bank, the facial recognition programme is 98% accurate.

As of 2021, Alfa Bank had launched 130 phygital branches across Russia, with the bank claiming that each branch saves 10 tons of paper each year.

Otkritie FC Bank – claimed it was the largest privately-owned bank in Russia. Otkritie Holding (OH), known as Otkritie Financial Corporation until May 2014, was formed in 1995 as a brokerage, but has developed into a broad-based financial group. Otkritie Holding obtained a banking licence in 2008 when it acquired Russian Development Bank in partnership with the state-backed Deposit Insurance Agency.

Since 2005, predecessor Nomos Bank has taken control of five banks or their assets/deposits: Regiobank (2005), Moskovsky Capital (2008), VEFK-Sibir (2009), Novosibirsk Municipal Bank (2009) and Khanty-Mansiysk Bank (2010), the country’s 24th-ranked bank.

In August 2012, Otkritie Holding made its biggest move to date with the purchase of 26.53% in Nomos-Bank from the Czech-based PPF Group. After buying out other Nomos shareholders, Otkritie Holding merged Nomos Bank and Otkritie Bank, creating one of the top 10 Russian banks. The merged bank was named Otkritie FC Bank, with Otkritie Holding having 65.28% of the shares.

Effective from 30 August 2017, due to financial difficulties, Otkritie Bank was placed under the management of the CBR, which became a 99.99% shareholder in December 2017, and 100% as of December 2020. During 2019, measures were completed to prevent the bankruptcy of Otkritie. In February 2020, the CBR announced plans to sell Otkritie Bank in 2021.

As of 2020, Otkritie had over 3.1 million active retail customers, 510,000 SME customers and over 74,000 corporate and investment customers, served through a network of 567 branches.

In 2020, Otkritie provided the full scope of its services as employees were transferred to a remote work regime. The bank significantly increased the capability of digital services, and the number of transactions performed without office visits. Penetration of Internet banking and mobile banking services to the retail segment increased from 56% at the beginning of 2020 up to 70% by the end of the year.

As of 2021, Otkritie had invested over $1 billion into IT and now 95% of its interactions with customers are digital. In December 2022, the Bank of Russia transferred 100% of Otkritie Bank in a sale to VTB Bank Russia.

Promsvyazbank (PSB), previously the second-biggest Russian-controlled private bank, was owned by Promsvyaz Capital (50.03%), EBRD (11.75%), three investors owning together 30% of the shares and free float (8.22%) for the balance. The bank is primarily a corporate bank and claimed second place, ranked by assets, among Russian private banks. As at end-2016, PSB reported 2.3 million retail clients and more than 160,000 corporate clients. Its regional network comprised 298 offices, 9,495 ATMs (including partner bank ATMs), and more than 200 self-service terminals across Russia. In December 2018, the Russian State bailed out the bank with up to RUR 25 billion, effectively nationalising the bank to 100%. The bail-out aimed at cleaning up a fragmented banking sector hit by bad loans and Western sanctions. The authorities then decided to turn PSB into a bank focused on the defence industry, transferring to it loans to the military made by banks such as state controlled Sberbank and VTB, Russia’s biggest two lenders. This should help to protect both defence firms and banks should the United States follow through on threats to impose more sanctions.

B&N Bank – MDM Bank, whose merger with Ursa Bank was completed in August 2009, became a major private universal bank, bringing together MDM’s network in central and western Russia with Ursa, traditionally strong in the Urals, Siberia and Russia’s far-east. The combined entity had 1,700 ATMs and 3 million cardholders in mid-2012. Sergei Popov was the controlling shareholder in MDM Bank, with 56.3%; other shareholders included the international organisations EBRD, IFC and DEG. As at end-2016, two individual investors owned 96.56% of the shares.

In November 2016, MDM Bank changed its name to B&N Bank. The bank was previously one of the TOP-5 privately-owned bank groups in Russia. B&N Bank claimed 4.4 million retail clients and over 95,000 corporate and SME customers serviced in more than 400 branches at end-2017. In late 2017, the Russian state, through the CBR, provided a RUR 57 billion capital injection to B&N bank, effectively nationalising the entity and removing it from private ownership.

Russian Standard Bank (RSB) is the largest privately-owned specialist consumer lending bank and the Russian pioneer in consumer finance. In 2020, it reported 28 million customers in Russia and the Ukraine. RSB claimed 25.4 million credit cards in issue and over 140 branches at end-2020.

With a nationwide branch network of over 150 offices, Russian Standard Bank is the Exclusive issuer of American Express® Centurion Line Cards, the strategic partner of Diners Club International® and the strategic partner in issuing and acquiring of Discover cards in Russian Federation.

During the credit crunch, RSB was rumoured to be experiencing funding problems, but its business model proved to be resilient and in August 2011 the bank received a seal of approval from EBRD, which extended it a three-year loan for RUR 4 billion (€100 million). EBRD said its common aim with Russian Standard was “to finance responsible consumer lending growth in Russia and to enhance transparency on loan terms in the consumer lending sector.”

Western-owned Banks 

Foreign banks played an active role in the country’s financial sector, although as of mid-2022 most had announced plans to exit the Russian market in response to the Ukraine conflict. There were 50 credit institutions in Russia that were wholly, or majority foreign-owned at the end of 2022.

UniCredit Bank, Rosbank, and Raiffeisenbank ranked among the top-10 Russian banks by share of total assets, though their respective shares of total banking sector assets as of 2023 were respectively 0.90%, 1.57% and 2.41%. Citibank, KBC, HSBC, Barclays, BNP Paribas, Santander, Svenska Handelsbanken, Swedbank and Rabobank have been among western banks leaving or substantially scaling down retail operations in Russia since 2010, some taking material losses in the process (see Appendix for further details).

UniCredit Bank is the largest foreign bank in Russia by total assets. UniCredit is primarily a corporate bank in Russia and reported 2.3 million individual customers at end-2023, and 56 branches in Russia in 2023, plus one representative office in Belarus.

During 2020, UniCredit transferred service models to a remote format of cooperation with customers and partners. The base of active customers in the affluent segment increased by 10%. The bank also retained its active customer base in the SME segment and increased the share of mobile app active users from 48% to 53% in 2020.

The volume of transfers via the Faster Payment System through UniCredit Bank increased four times compared to 2019, and the number of customers using that service grew five times. The bank also reported that customers are actively using QR codes for payment for goods and services. Payments worth a total of RUR 9.7 million were made this way in 2020.

In early 2022, UniCredit announced plans to exit its banking operations Russia, stating it had received several offers from Russian bank institutions to buy its local subsidiary. By 2023, UniCredit is yet to exit Russia partly due to its inability to secure a buyer despite extending the offer to non-local investors but also due to Vladmir Putin’s restriction on sale of Russian Banks. As of 2024, UniCredit is still operating in Russia. UniCredit is considering leaving the Russian Federation, but with the possibility of returning after the war.

Rosbank is one of the 10 core credit institutions, according to CBR. After acquiring an initial 10% stake in Rosbank from Interros in 2006, SocGen exercised its option to take control in February 2008. In 2010, SocGen announced plans to merge all its Russian subsidiaries – Rosbank, BSGV, Rusfinance and Delta Credit – into Rosbank; on completion in June 2011, SocGen’s stake was 82.4% and this was raised to 92.4% in October 2013 when SocGen bought VTB’s 10% stake. In 2021, SocGen owned 99.95%, and the bank serviced more than 5.0 million customers in over 300 offices, in addition to 77,000 small business clients and 7,350 corporate clients.

In June 2019, Rosbank completed its merger with DeltaCredit Bank, providing clients with a full range of banking services following the integration of DeltaCredit’s mortgage platform into Rosbank’s retail business. In November 2020, Rosbank announced it would merge with Rusfinance Bank, a Rosbank subsidiary, in order to improve the efficiency of the retail business and expand opportunities for cross-selling.

In April 2022, Société Générale ceased its activities in Russia and signed an agreement to sell Rosbank to Interros Capital, the previous shareholder of Rosbank. The sale was completed in May 2022.

Raiffeisen International reported more than 2 million customer accounts in Russia at end-2022. Raiffeisen’s original deal to buy Impexbank was the first acquisition by a western bank of a substantial retail bank in Russia, with a nationwide distribution network of branches and consumer finance outlets. In 2022, the bank reported 127 business outlets in Russia.

In March 2022, Raiffeisen announced it was considering exiting Russia and was assessing strategic options. Up till August 2023, Raiffeisen still remains stuck in Russia with no exit plans or buyers in sight. In May 2024, Raiffeisen announced plans to begin its exit from the country in the summer of 2024 based on Western threats. However, by September 2024, RBI revealed that a Russian court has frozen shares in its local arm, stalling the long-awaited sale.

Citibank is the biggest US bank in Russia. More than 3,000 institutional clients and around 500,000 retail customers, including 280,000 credit card holders, are served in more than 90 branches located in 12 cities across Russia.

During 2020, Citibank reported an increase in digital channels usage, with 55.3% of financially active clients using the mobile app monthly in 2020.

In August 2022, Citibank announced it would close its consumer and commercial banking businesses in Russia, having first announced plans in April 2021 to leave the retail business as part of a broader departure from some overseas markets. It expanded plans to exit in early 2022 to include local commercial banking after Russia’s invasion of Ukraine. but has been unable to find a buyer for either business.

In October 2022, Citi announced that it would cease providing virtually all services in Russia for corporate clients by the end of the first quarter of 2023. Thereafter, Citi’s operations in Russia will only include the services required by the company’s legal and regulatory obligations. In May 2023, Citibank signed an agreement with Uralsib Bank to transfer its credit card portfolio to the Russian lender, subject to customer approval.

Digital Challenger Banks 

A number of digital challenger banks have entered the Russian market, e.g. Revolut (UK). They already have a clear digital banking strategy in place.

In parallel, many Russian banks co-operate and partner with trusted digital payment providers and FinTechs to prepare for the Open Banking ecosystem, enrich their digital banking services, and to offer additional mobile banking app features.

Revolut – In June 2018, digital challenger bank Revolut entered the Russian market after inking a deal giving it access to the payment infrastructure of local player Qiwi Bank. Revolut used the Qiwi Open APIs to gain access to banking licenses and technologies for customer identification, payment processing, and card issuance, enabling Revolut to offer products and services to Russian consumers. Revolut began with an app and free multi-currency VISA card for payments, ATM withdrawals, and FX transfers in 130 currencies. Launched in 2015, Revolut claimed to have more than 45 million customers worldwide making nearly 600 million transactions a month as of December 2023. In 2023, Revolut added 12 million new customers.

In January 2022, Revolut launched as a bank in 10 Western European countries, enabling it to offer its customers in these markets deposit protection. The financial super app, which has more than 45 million customers around the world, has taken advantage of its Lithuania-based European specialised banking licence to become a bank in Belgium, Denmark, Finland, Germany, Iceland, Lichtenstein, Luxembourg, Netherlands, Spain, and Sweden.

Tinkoff Bank – founded in 2006, Tinkoff Bank claimed to have 40.4 million total customers as of 2023 (with 28 million classed as active customers), who held 33.5 million debit cards and more than 13.1 million credit products. According to Tinkoff, it is the leader in retail debit card features, with its Tinkoff Black premium debit card product at the core of its ecosystem. There were over 24.5 million total Tinkoff Black customers as of end-2022.

In September 2020, Russian technology firm Yandex agreed a $5.5 billion deal for the acquisition of Tinkoff Bank. However, in October 2020, the deal was scrapped after the two parties were unable to agree transaction terms. In 2020 Tinkoff claimed it had become the largest player in the CBR’s Faster Payments System.

In April 2021, Tinkoff Bank launched Russia’s first buy-now-pay-later (BNPL) service. The Dolyame.ru service allows customers to split the purchase price of goods sold online into four equal parts. In order to make a purchase, they need cover 25% of its price. The remaining three quarters is debited from the buyer’s card on a bi-weekly basis until the full payment amount is received.

According to Tinkoff Bank, its super app, launched in 2019, acts as an entry point for customers to access all of Tinkoff’s financial products as well as a combination of proprietary and partner lifestyle services. Around 90% of Tinkoff customers use the app every month, with 28 million monthly active users, and around 350 million monthly in-app payments in 2023.

At the beginning of 2021 Tinkoff launched Tinkoff Checkout, a payment service for businesses. Tinkoff Checkout is operating as a one-stop shop, enabling companies to take care of all of their online and offline financial needs in one place. In acquiring and payments, Tinkoff recorded 12,000 active merchants in 2021.

In 2021 Tinkoff claimed to be one of only 13 profitable digital banks globally, and the only profitable one in Russia. In 2022, Tinkoff announced its acquisition of a 51% stake in BANKOM, a Russian developer of innovative ATM solutions. BANKOM specialises in servicing ATMs, POS terminals, and other payment systems, from distribution, repairs, and branding to offering creative technology and adding new custom-made features. In May 2023, Tinkoff launched ‘Tinkoff Pay’ – an instant payment service that enables quick, easy, convenient, and secure purchases of products and services in online and offline stores without entering your card details.

In December 2022, Tinkoff became the first Russian bank to produce its own ATM, called Odin, which was designed and assembled in Russia using domestic equipment and components. Tinkoff also introduced the Tinkoff Pay payment sticker, a new contactless payment method in 2022.

Bank 131 – In March 2019, Bank 131 became the first new bank to receive a licence in Russia since 2015. The digital bank offers API-based solutions for Russian and international companies, including e-commerce companies and entrepreneurs that are underserved by the existing banking industry. Bank 131 also aims to explore the Bank-as-a-Service (BaaS) model, customising the solution for each client.

Digital Banking

All retail banks in Russia offer online banking and mobile banking apps to their clients. In response to the changing needs of their client base, Russia’s banks are transforming their businesses into high-tech, digital companies. Adoption of digital banking services, particularly mobile banking, is high. According to the CBR, in 2020 more than 84% of SME businesses use digital banking (2015: 68%).

Internet banking and mobile banking apps are offered widely. Most of the Russian bank’s operating have implemented online banking systems for corporate customers. Services available include intra-day reporting and domestic and cross-border payment initiation. Users can add their bank, loyalty and travel cards to a smartphone wallet application to be used as an alternative method of electronic payment. Russia had an internet penetration rate of 90% at end-2023.

CBR, the Bank of Russia, has noted the tendency for large banks to reduce their branch networks in its banking supervision reports. This was enabled by rapid expansion of remote banking facilities, with adoption by customers encouraged by means of pricing incentives as well as convenience factors. Also, the development of the money transfer operators’ payment infrastructure contributed to further growth in offering remote banking services.

CBR said that the number of remote access accounts opened by individuals with credit institutions and used for cash-less payments per year grew by 7.64% to 376.74 million in 2023, up from 350.02 million in the previous year. In addition, the numbers of remote accounts with internet access and with access by mobile devices showed significant growth rates, respectively. These channels’ share of the total number of remote access accounts opened by individuals amounted to 96.1% and 72.%, respectively, as at the end of 2023 (see Table 13).

There is no bank-independent electronic banking standard in Russia; each bank offers its own proprietary system for corporate banking purposes. The bank‑independent MultiCash platform is offered by a number of banks.

Sberbank (Sber) said the number of customers using Sber Online banking increased to 74.8 million at end-2020, up from 69.9 million the previous year. The number of active users of its mobile app service rose to 65 million from 55 million in 2019.

4 - Cashless Payment Transactions in Russia
(Millions)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Payments on cards	39,217.0	48,028.5	62,414.4	69,298.0	75,845.5	9.4%	21.1%
E-money transactions	2,420.2	2,914.6	3,276.5	3,417.9	4,154.4	21.6%	17.0%
Cheques issued	-	-	-	-	-	-	-
Credit transfers	2,368.7	2,651.7	3,621.9	5,744.2	9,389.5	63.5%	35.5%
Direct debits	199.4	225.6	223.5	223.2	205.3	-8.0%	7.4%
Other payment instruments	1,762.0	1,863.6	2,079.3	2,665.6	3,313.2	24.3%	15.6%
Total	45,967.2	55,684.1	71,615.6	81,348.9	92,908.0	14.2%	21.7%
Total card payments per capita	267.2	327.9	426.2	473.2	519.0	9.7%	21.2%
E-money transactions per capita	16.5	19.9	22.4	23.3	28.4	21.8%	17.1%
Total cheques issued per capita	-	-	-	-	-	-	-
Total credit transfers per capita	16.1	18.1	24.7	39.2	64.2	63.8%	35.6%
Total direct debits per capita	12.0	12.7	14.2	18.2	22.7	24.6%	15.7%
Total cashless payments per capita	313.2	380.2	489.0	555.4	635.7	14.5%	21.8%
Note: credit transfer and e-money figures have been restated.
Note: BIS does not give an explanation of "other payment instruments".
Source: CBR, BIS.

In April 2016, Sber founded its own MVNO for mobile banking, SB-Telecom. It is owned by Sber indirectly, via companies Digital Assets and Digital Technologies. SB-Telecom provides telecommunications services for companies within the Sber group, as well as for customers of the group.

In November 2017, Sber said it would build an ID platform, SberID, that supports face, voice and retina biometrics. In 2019, SberID became a single authentication system for secure sign-in to online services offered by Sber. By 2020, there were over 16 million SberID users.

As of 2020, Sber reported over 1 million monthly active users of its SberBusiness app, and 65 million monthly active users of the mobile app Sberbank Online,

During 2020, Sber also expanded its contactless mobile payment SberPay service, and there were over 2.2 million active users of SberPay as of 2020.

Sber developed more services for its technology platform in 2020, including suite of Salut voice assistants and the SberBox and SberPortal smart devices. The chatbot makes it possible to automatically address customer queries in 65% of cases. It is available to clients through three channels: the mobile app and the web version of Sberbank Online. The bot is based on AI technology for recognising the topic of a client question to run the suitable service scenario.

Sber continued to expand the line of public sector services in 2020 with the integration of the Digital Profile service of the Gosuslugi portal, allowing non-salary clients to confirm their income via the web version of Sberbank Online using an electronic statement from the Pension Fund of Russia.

VTB Bank also reported substantial growth in its internet-based business in 2020. The number of customers using Telebank and Teleinfo systems were 10.1 million during the year, 67% of VTB’s clients. In June 2016, VTB24 announced the installation of secure mobile banking apps providing one-time passwords for validation of remote banking transactions. In 2017, VTB reported 6.7 million internet banking clients. In the light of the legal VTB24 merger with VTB bank, this figure is believed to be incomplete.

In December 2022, VTB purchased 100% of shares in Otkritie Bank from the Bank of Russia for RUB 340 billion. Following its consolidation, the Group’s assets grew by 20%.

During 2019, VTB launched a digital factory to develop and introduce new high-tech products and services for SMEs. The objectives of the digital factory include the organisation of business processes related to remote sales, the introduction and development of non-banking services for entrepreneurs, the provision of state-of-the-art digital solutions for business, as well as the development of new digital communication channels.

In 2019, VTB received a patent for a blockchain-based multi-issuer settlement and payment system. The technology will enable VTB to create digital products, services and payment instruments that provide a solution for the problem of accounting for reciprocal payments between a practically unlimited number of system participants.

In December 2020, VTB updated its VTB Business Lite mobile bank to serve entrepreneurs. The app added new functionalities, such as invoicing, as well as simplified transfers to legal entities and individuals or between a business’s own accounts. The number of users increased 150% in 2020 to almost 90,000.

As part of implementation of the strategic task of moving financial services online, VTB continued to introduce new digital tools for consumer, mortgage and car lending. In December 2020, VTB became one of the first banks in the Russian market to enable customers to get a car loan and complete a purchase entirely online by submitting an application through VTB Online (launched in January 2021). VTB Bank’s medium and small business client base increased by more than 25% in 2020 to 636,000.

As part of its technological transformation strategy, VTB continued introducing automated solutions and machine learning technologies in its digital services, such as investment advisory service available through the VTB My Investments application. In 2022, the Bank achieved all its digital transformation goals. In particular, VTB transitioned to electronic document flow, finally migrated to cutting-edge microservice IT infrastructure. Also, the bank was the first Russian bank to develop an omnichannel platform, which made it possible for its customers to fully switch to remote servicing. The Bank was also the first in Russia to test digital rouble transfers between customers. In August 2023, VTB was the first bank to successfully test digital rouble transactions in its VTB Online mobile app as part of piloting real digital money.

The number of active users (MAU) of the VTB Online app rose to 15 million in 2023 from 12.5 million in 2022. For customers of other banks, VTB introduced Easy Bank, offering instant access to financial products; more than 400,000 users signed up for the service in 2021.

During 2021, VTB launched a voice assistant named Leo. The virtual assistant is able to advise customers on 1,500 topics. In less than a year of operation, it helped 340,000 users make payments and transfers worth RUB 30 million.

A quarter of a million VTB Online users make over 800,000 transfers every day. In 2021, VTB enabled transfers via a link, QR code or the VTB Radar function, which enables users to find other VTB customers located nearby using Bluetooth and AirDrop technologies and to quickly send them a money transfer. VTB continued integrating municipal services into VTB Online, enabling Moscow residents and non-residents to rent bikes through the Velobike service, and to track and top up the balance on Troika transport cards, parking accounts and transponder accounts with Avtodor-Toll Roads. In 2022, 11.5 million retail customers make over 50 million payments and transfers through VTB Online each month and 1 million of Small and Medium Business customers use the Internet bank. In 2023, VTB Online users grew by nearly 20%. As of the end of 2023, VTB Online served 17.7 million users, with 15.3 million taking actions at least once a month. They visited the mobile app and Internet bank over 300 million times per month. Over the year, 9.1 million products were sold through VTB Online, up 20% year-on-year. Users logged into VTB Online for more than 200 million times a month in 2022. In the same vein, 97% of new customer deposits were placed online, 74% of SME customer inquiries were handled by chatbots, and 97% of credit cards were issued without income verification, with borrower review relying on big data and AI-powered technology. As part of the bank’s digitization efforts, over 80% of mortgage application submitted remotely in 2023.

VTB launched its Paperless Banking programme in late 2020. In just two years, the Bank successfully transitioned to efficient paperless document storage and electronic document flow. Currently, 97% of documents are processed and stored electronically, resulting in cost savings of over RUB 3.5 billion since the programme’s launch. In just 3 years, the Bank successfully transitioned to efficient paperless document storage and electronic document flow. In 2023, paper consumption went down by 31% year-on-year.

In 2021, VTB made a change to its remote banking system, RBS 2.0, adding a new electronic application for cash withdrawals that enables customers to order cash withdrawals online without hard-copy paperwork. In addition, VTB launched a service enabling legal entities and individual entrepreneurs to make transfers to individuals by phone number through the CBR’s Faster Payment System. Using blockchain technology, VTB completed payments on behalf of agents for air tickets from S7 Airlines on TechLab’s blockchain platform, and it also created a blockchain scenario to speed up the shipment of metal products (even outside of banking days) on SAP’s Business Technology Platform, which enabled customers to automate their shipment process and reduce costs.

5 - Average Exchange Rate
	2019	2020	2021	2022	2023
1 EUR in RUR	72.4553	82.7248	87.1527	70.8605	91.5924
1 USD in RUR	64.7276	71.9422	73.6457	67.4562	84.6566
Source: ECB (€), CBR ($).

Alfa Bank reported that more than 80 % of active retail customers (7.3 million) used its mobile app on a monthly basis in 2020. Alfa-Bank has simplified retail processes such that clients can receive most products without visiting a bank office or calling its client support centre. During 2020, Alfa Bank reported that the number of transactions per customer in remote channels and transactionally active customers rose by 64% and 33%, respectively.

Alfa-Bank claimed to be number one among universal banks in terms of the share of retail customers being active mobile app users. Alfa-Business Mobile’s customer base grew 30% in 2020, and the number of those who only use the app (without using the Internet bank) doubled. One in four Alfa- Bank’s corporate cards is issued through the app.

Another area for development from 2021 onwards will be creation of new services based on the instant payment system (IPS). They include payments for goods and services using QR codes, transfers from accounts opened with other banks and new B2C and B2B services.

In 2020, Alfa-Bank strengthened its position as a paperless bank by adopting digital signatures. Three out of four documents were signed with digital signatures. Around 60% of all lending transactions at Alfa-Bank were paperless in 2020, due to the mobile app using electronic signatures, while its banking for business platform uses qualified electronic signatures. Prompts and settings in the mobile app nudge clients to use virtual payment systems instead of plastic cards.

Gazprombank stated that during 2020, it was ready to handle the pandemic’s effects on customers, mostly due to its high level of digital transformation reached in recent years. Prompt implementation of a special programme, which built the up-to-date IT infrastructure, helped to shift the bank’s operations to a remote work model.

The number of Telecard 2.0 online banking customers almost doubled to 2.6 million people, the average income of an active user grew by 1.5 times, and the penetration into the active card base was 81% (1.5 times more than in 2019).

Online servicing was organised on the basis of an omni-channel platform, with the number of service integration points growing by six times during 2020. Customers gained remote access to credit and debit cards, blocking and unblocking cards, consumer and car loans, limit management, debt restructuring and prepayment services.

Online channels brought three times more revenue in 2020 than in 2019. Income from online channels exceeded RUR 12 billion, including over RUR 7.2 billion from online banking channels for retail customers. Gazprombank’s official website also added demanded functions, and sales through it provided for an income of RUR 4.9 billion.

In February 2018, Russian digital bank Tinkoff opened a development hub at a major Moscow innovation centre where a team of staffers would work on areas such as blockchain and biometrics.

In 2020, Tinkoff unveiled its AI Banking strategy that aims to transform its customer offering through personalisation with the help of AI across all products and services. To that end, Tinkoff has expanded the use of AI across its financial and lifestyle services to provide tailored advice, interface personalisation, automation of repetitive financial tasks and interactive content that drives engagement and improves the customer experience.

In 2018, the CBR approved the Guidelines for Financial Technology Development for 2018-2020 to promote objectives including: promoting competition in the financial market; raising financial inclusion and increasing the quality and range of financial services; reducing risks and costs in the financial sector; ensuring security and stability in applying financial technologies; raising the competitiveness of Russian technologies. Measures stipulated in the Guidelines contribute to the implementation of the Digital Economy of the Russian Federation programme and other FinTech-related projects.

In Russia, fintech and digital payment ecosystems are often built on the basis of large financial institutions that have the necessary resources and technological base. Unlike western European markets where smaller FinTech start-ups have led the development of digital financial services, the Russian FinTech market is largely driven by the big market players, mostly banks.

With a large amount of information about their customers, major commercial banks are able to offer them a single environment for obtaining a wide range of services to satisfy their everyday needs on a unified technological platform. However, due to governmental restrictions, Russian state banks are unable to develop FinTech potential without co-operating with start-ups and tech companies.

In addition, the leading bank ecosystems not only expand their own product lines but also interact with service providers from other sectors of the economy. This creates a synergistic effect due to more efficient processing of client information and the provision of common services available within an ecosystem. Ecosystem participants also accumulate customer data, which allows them to acquire non-competitive advantages compared to other players on the financial market.

According to the CBR, in the realm of FinTech developments, during 2020, the piloting of transactions with digital bank guarantees and testing of business functionality continued on the Masterchain platform developed by the FinTech Association with financial market participants. As a result, seven organisations connected to the service by the end of 2020.

In 2020, the authorities also allowed the use of regulatory sandboxes for piloting digital services and products, including in the financial market. Since the launch of the regulatory sandbox, the CBR has received 70 applications from banks, FinTech, and other companies to pilot financial services. The main objective of the regulatory sandbox is to create a mechanism for the quick and safe implementation of digital payment innovations that drive financial inclusion and improve efficiencies in payment systems.

In relation to Open Banking developments, in October 2020, the CBR published four standards for open banking interfaces (open APIs):

• General provisions
• Receipt of information about customer accounts by third parties
• Initiation of transfers of customer funds by third parties in the currency of the Russian Federation
• Requirements for security of financial services based on the OpenID protocol.

In 2021, the CBR developed and published two new open API standards:

• Obtaining Public Information about a Credit Institution and Its Products
• Safety of Financial (Banking) Operations

According to the CBR, open APIs promote higher competition and equal opportunities for all market participants in creating new financial platforms. Furthermore, they enable clients to manage their data and receive customised services. Additionally, in 2021, the CBR and the central banks of the EAEU member states carried out a cross-border pilot project on APIs. Within this pilot project, 13 financial institutions from five countries exchanged information on the location and business hours of customer service offices, ATMs, and exchange rates of national currencies.

Payment Services

In 2024, the more than 300 different payment services offered in Europe can be grouped into:

• Card brands and card types
• E-money and prepaid products by issued brand
• Account-based payment services by issued brand, e.g. IBAN-based SCT/SDD services
• Advanced payment services. e.g. wallets by issued brand
• Digital payment services, e.g. digital scheme wallets by issued brand

Card Brands and Card Types

All Russian retail banks issue cards. In parallel, development of payroll schemes continued to drive cards usage. International cards have been issued in Russia since the 1980s, through the old Intourist travel agency monopoly; the first VISA cards were issued in 1988. In 2015, JCB started its card issuing business with Russian banks.

MIR cards – In December 2015, Russia launched its first national payment card (MIR means ‘world’ in Russian). Branded ‘MIR’, the cards can be used for withdrawals, deposits at ATMs, payments of goods and services and for funds transfers between card holders. MIR cards are co-badged for use with other international schemes such as Mastercard, American Express, JCB, and UnionPay. The international expansion of MIR cards includes bilateral acceptance agreements with the domestic schemes of other CIS countries. By end-2016, there were 1.76 million MIR cards in circulation, and 31.2 million MIR cards by end of January 2018. In 2017, President Vladimir Putin signed a law that established an obligation for Russian banks to use MIR as a national payment system, requiring its use to process all state welfare, civil servant salaries and pension payments by July 1, 2020.

In 2020, projects for the introduction of non-financial services using MIR cards were successfully implemented. The Resident Card projects were implemented in 15 constituent entities of the Russian Federation. MIR cards could also be used to pay overland transport fares in 77 regions and metro fares in seven cities.

By the beginning of 2021, the service of direct payments of insurance coverage by the Social Insurance Fund of the Russian Federation to insured persons on MIR cards was introduced throughout the entire territory of the Russian Federation. To increase the involvement of MIR card holders and banks, the loyalty programme (cashback service) of the MIR payment system and the MIR Pay mobile contactless payment app were successfully developed.

In 2023, the number of MIR cards in circulation grew 1.6x to 287.3 million as the pressure of sanctions increased the importance of national payment instruments. The Mir payment system was actively used in social and transport applications. There were about 1.9 MIR cards for every inhabitant of Russia. MIR cards comprised 55% of the total value of domestic transactions in 2023, compared to 41.3% in 2022. Two-thirds of all domestic card transactions were made using Mir cards.

Holders of MIR cards made 45.7 billion transactions for a total value of RUB 87.6 trillion in 2023, 1.5x and 1.6x greater than in 2022, in terms of volume and value. However, in 78 cases out of 100, MIR cards were used for payment of goods and services. The number of registered users of the MIR loyalty cashback programme reached 66 million, compared to 26.8 million in 2021. The MIR payment system supported the implementation of the Tourist Cashback program for the return to citizens parts of the cost of travel, tourism, and children’s recreation in Russia. The number of credit institutions offering the mobile contactless MIR Pay service increased from 82 in 2021 to 149 in 2022. Fuelled by the development of the loyalty programme (a cashback service) of the Mir payment system, the number of Mir cards registered in this programme doubled, reaching 138 million cards in 2023.

By the end of 2022, social project cards based on MIR cards were present in 28 regions, compared to 23 in 2021.  Almost all constituent entities of the Russian Federation (84) have the opportunity to make payment on the MIR card for travel on land transport, in the subway – in seven regions. The MIR Card Payment System comprised 232 acquiring banks and 158 issuing banks as of January 2022, with MIR accepted in 14 countries, including Armenia, Belarus, Kyrgyz Republic, Tajikistan, Uzbekistan, and Vietnam. Mobile and contactless MIR services are also developing, along with support for Samsung Pay. Outside of Russia, MIR cards are accepted in 8 countries, including the countries of the Eurasian Economic Union (EAEU). In terms of expanding the geography of accepting MIR cards, priority is given to countries that are popular from citizens of Russia for tourist trips and seasonal residence.

In addition, local debit card schemes like NCC cards, UnionCard (UC), STB cards, and Accord cards (BashCard) were often used as special purpose regional or local payroll cards (salary cards). In 2019, the CBR officially excluded NCC and UnionCard as payment system operators.

Dedicated Zolotaya Korona (ZK) cards are issued as specific money transfer cards for expatriates.

In early 2022, in response to the Ukraine conflict, Mastercard and VISA suspended services in Russia where they make up about 70% of the debit card market. American Express, PayPal, Japanese card network JCB and Western Union also suspended services in Russia, as well as digital wallets Apple Pay and Google Pay. However, while international transactions have been limited, domestic transactions operate as normal, including for VISA and Mastercard cards. This has had the effect of pushing up usage of the domestic MIR card system significantly.

The UEC card was an identity E-card that is issued to Russian citizens starting from January 2013 and was aimed at gradually replacing the internal passport of Russia. The card ceased issuance in December 2016.

Russian card products like consumer cards, commercial cards and purchasing cards range from classic cards to gold cards and platinum cards. Additional card features (e.g. picture cards, bonus points, PIN selection at ATMs and card control by SMS notification) are used to attract cardholders. Also, individual picture cards and collector cards can be issued on demand. Further, card-to-card P2P services have been launched.

The EMV migration of cards achieved 55% by end-2013 and was completed by end-2017. All MIR cards are EMV-compliant.

From July 2023, banks and other card issuers will no longer issue Maestro cards. Instead, they will need to issue Debit Mastercard. Maestro was launched in 1991 and was the world’s first debit card that could be used via an online network. About 400 million Maestro cards are in circulation worldwide, mainly across Europe. However, Maestro is not enabled for the demands of e-commerce and cannot be used for online or in-app payments, hence the decision to phase it out in favour of Mastercard Debit products. Visa announced that Electron cards will be phased out globally in 2024. The features of the Visa Debit card have been modified to match the features of the Visa Electron card.

Debit cards issued are MIR, Mastercard, VISA, Maestro, and Electron cards. There are no V PAY cards in circulation.

Credit Cards issued are cards branded VISA, Mastercard, American Express, JCB, Diners, Discover or UnionPay.

Prepaid Cards – The Russian banks issue prepaid cards and virtual prepaid cards for internet use.

Co-branded cards – In Russia, there are several co-branded card products in circulation. Co-branded cards are based on the international card brands JCB, American Express, UnionPay, Mastercard and VISA.

Co-branding partners of Russian issuer banks include airlines, retailers, telecom firms and consumer goods manufacturers. In June 2017, SMP Bank issued a co-branded Aeroflot MIR card. In July 2018, Russian Agricultural Bank launched a co-branded Panasonic JCB card.

Contactless Cards and form-factors

The rollout of contactless cards has gained momentum. Most major Russian banks issue contactless MIR cards, VISA payWave, and Mastercard PayPass cards.

Contactless Card Form-factors – From November 2013, Russia’s UniCredit Bank offered contactless cards as NFC stickers that could be attached to mobile phones. In June 2015, Alfa Bank launched a contactless-enabled watch, Watch2Pay, which enables payments with a tap of the wrist wherever Mastercard PayPass is accepted.

According to the CBR, in 2021, contactless payments increased by 1.3 times in terms of the number and 1.5 times in terms of value, up to 35.4 billion transactions for the amount of RUB 33.2 trillion. More than 26.6 billion transactions worth RUB 24.9 trillion were conducted with contactless cards, while contactless cards comprised almost 80% of all cards in circulation in 2021. In 2022, consumer demand for contactless technology remained stable. More than 74% of operations for payment for goods and services were carried out with using contactless technologies and the share of such operations in value exceeded 55%. As of end-2022, almost 90% of devices for receiving payment cards supported contactless technologies.

As of 2021, mobile contactless payments accounted for over a third of all card transactions (34%) and just under a third of total card transaction value (31%) in Russia, compared with 25% of transactions and 23% of transaction value in 2020, according to MTS Bank research. Overall transaction values for mobile contactless payments made using services such as Apple Pay and Google Pay increased by 84% in 2021 compared with 54% in the previous year, while transaction volumes grew by 66% compared with 37% in 2020. Around 45% of mobile contactless payments in Russia were made using Apple Pay, 36% using Google Pay, 15% using Samsung Pay and 4% using other services such as MIR Pay.

Sberbank and Alfa Bank ran a pilot test on NFC stickers in January 2023. The stickers are to be attached to the back of iPhones to enable customers to make contactless payments for goods and services with their smartphones. This came after Visa and Mastercard stopped servicing cards issued by Russian banks and both Apple Pay and Google Pay suspended support for contactless mobile payments made using MIR cards issued by Russia’s National Payment Card System in March 2022. VTB also launched a similar pilot project of bank payment stickers for its existing customers in May 2023. The goal is for the stickers to become an alternative to contactless payment services using smartphones. As the card does not contain a number, an expiration date, or a CVC code, it is believed to be more secure.

Tinkoff introduced the Tinkoff Pay payment sticker, a new contactless payment form factor in December 2022.

According to VISA research, Russia is the number one country globally in terms of the number of cities accepting contactless payments on their transit systems, with the largest number of contactless transit transactions in the world. Most transactions in Russia on transit are currently being made by phone, not by card. Russia is also digitising its closed-loop travel systems, so that passengers will also be able to use their travel cards via phone, while the Moscow Metro has been piloting contactless payments through a facial recognition system.

Predefined contactless limits – Contactless payments for purchases below a predefined limit are without PIN or signature and without transaction receipt. In Russia, the contactless limit for payments without PIN/signature was set at RUR 1,000 for cards with PayPass or payWave function. In March 2020, in response to the COVID-19 pandemic, the limit was raised to RUR 5,000 to encourage more non-cash transactions.

Interchange Fee Arrangements

International and Intra European Non-EEA Interchange Fees are set by the members of the international card schemes to be applied in case of cross-border transactions or foreign cards used in Russia, respectively. The effective rates of Mastercard and VISA Europe can be found on the respective Mastercard and VISA websites.

Domestic Merchant Interchange Fee (DMIF) for Russian cards is defined by Mastercard and VISA, respectively.

E-Money 

By end-2013, CBR noted that electronic money was becoming more popular as remote technology evolves in Russia.

In 2023, there were 60 e-money institutions resident in Russia, down from 99 at end-2016. On an abstract level, the Russian law on e-money services is similar to the e-money directive of the EU.

E-money in Russia includes prepaid cards, prepaid accounts. Virtual e-money cards and prepaid e-wallet accounts. Also, software-based e-money e-/m-wallet services are offered by the leading Russian payment aggregators and e-wallet issuers.

Account-based Payment Services 

In the Yearbooks, account-based payment services are classified as bank payment services on bank accounts offered by banks or by independent payment initiation service providers (PISP).

Credit transfers are used for both high-value corporate and low-value retail payment transactions. They can be paper-based or automated. Electronic credit transfers are used by companies for salary and supplier payments. The majority of paper-based credit transfers are postal transactions.

Direct debits (payment requests) are available in Russia but are limited to tax and court claims. There are two types of direct debit in Russia: preauthorised and non-preauthorised. Direct debits are usually initiated as payment requests, either ‘with acceptance’ (i.e. non-preauthorised) or ‘without acceptance’ (i.e. pre-authorised). Preauthorised direct debits are used to effect regular utility bills. Collection orders (similar to payment requests ‘without acceptance’) are used to collect tax payments.

In June 2019, the CBR launched Russia’s faster payments (see below).

As in many European countries, bank transfers have been adopted for online payments, enabling consumers to pay direct from their bank account as an alternative payment service to cards.

Advanced Payment Services

In the Yearbooks, advanced payment services are classified as online wallets, e-wallets, and/or mobile wallets with any type of payment service chosen by the wallet user to complete the payment.

The four major online wallets in Russia are WebMoney, YooMoney (formerly Yandex.Money), Qiwi, and RBK Money. As well as electronic commerce, most are involved in money remittances in Russia and beyond.

Therefore, in Russian online shops, the wallets YooMoney, Qiwi, PayOnline, RBK Money, and Webmoney are accepted as payment means.

Alipay – In January 2016, Alipay entered Russia co-operating with VTB Bank Group. In August 2017, Alipay and VTB Bank made the popular Alipay mobile payments app accessible to local merchants. VTB Bank started merchant acquiring for Alipay in its over 120,000 POS-device network. More than 1 million Chinese travellers to Russia now have access to mobile payments. In October 2019 Russian internet company Mail.Ru agreed a joint venture with Alipay along with the Russian Direct Investment Fund (RDIF) and two other Russian partners. The new joint venture for payments will work to accelerate the development of Russia’s digital economy by upgrading the country’s digital payment services.

In February 2022, Sberbank launched money transfers with Alipay, enabling money transfers to be sent to China, but following the outbreak of the Ukraine conflict, the service was closed.

WeChat Pay – In November 2018, WeChat Pay entered Russia co-operating with Yandex Checkout. Payments via WeChat Pay are contactless and processed via QR-codes. At checkout, the customers open WeChat on their smartphone, let the cashier scan the QR-code, and confirm the payment from their phone. WeChat has over 1 billion active monthly users, while the number of WeChat Pay users recently reached over 1.3 billion in 2023. Moreover, nearly 100 million users are outside of China.

PayPal – PayPal had already exited from domestic services in Russia in 2020, but as of early 2022 the company announced it had restricted its remaining business activities in the country, which included blocking the e-wallets of Russian clients from March 18, 2022.

As of end-2023, PayPal reported 426 million active customer accounts globally, down 2% from 435 million in 2022. This consisted of 391 million customer active accounts and 35 million merchant active accounts across approximately 200 markets. PayPal’s total payment volume increased to $1.53 trillion (up 12% from 2022) and customer engagement grew to an average of 58 transactions per active account, driving 14% growth in transactions per active account at the end of 2023.

During 2020, with consumers worldwide embracing digital wallet capabilities, the company launched several related services including QR Code Checkout, Buy Now Pay Later, Crypto purchasing and Xoom direct transfers to bank accounts and debit cards.

In June 2018, PayPal continued its shopping spree with a $400 million cash deal to acquire e-commerce platform Hyperwallet. The acquisition followed deals to buy Venmo, Xoom, Sweden’s iZettle (renamed Zettle) for $2.2 billion and AI-based merchant marketing outfit Jetlore, as Paypal bids to extend its reach to all corners of the payments market.

In May 2022, PayPal Ventures invested in Modulr, an embedded payments platform for digital businesses, as part of a $108 million Series C funding round led by General Atlantic, Blenheim Chalcot, Frog Capital, and Highland Europe. Modulr delivers payments infrastructure for over 200 top-tier customers, including Revolut, Wagestream, Sage and BrightPay, and processes an annualised transaction value of more than £100 billion.

In 2023, PayPal is exploring the sale of Xoom, its international money transfer subsidiary, in a bid to cut costs and focus on high-growth business areas. Also, Stax Payments – an all-in-one payment provider for businesses – announced its partnership with PayPal in July 2023. This partnership will allow PayPal’s users to easily make payments with more than 20,000 merchants of Stax through a fast checkout process as well as new payment options such as Buy-now-pay-later solutions.

In 2023, PayPal launched its own US Dollar denominated stablecoin, PayPal USD (PYUSD), which is fully backed by US dollar deposits, short-term US treasuries, and similar cash equivalents and designed for digital payments and Web3. Eligible US PayPal customers who purchase PayPal USD will be able to transfer the token to external wallets, send person-to-person payments, fund purchases at checkouts supported by PayPal, and convert cryptocurrency holdings to and from PayPal USD.

In January 2024, PayPal launched AI-powered features to drive personalised offerings for both merchants and customers based on the data it possesses. These features include Smart Receipts (for merchants) which predicts what shoppers may want to buy next from the merchant. The merchant can then offer personalised recommendations, and cashback offers on this receipt. A major feature for users is CashPass which will use give users personalized cashback offers based on an AI analysis of their spending activity.

In March 2024, PayPal launched a complete suite of payment processing tools for online small businesses in the UK, Canada, and across more than 20 European markets. The PayPal Complete Payments package enables small businesses to accept an expanded range of payment instruments including PayPal, buy now pay later, Apple Pay, Google Pay, credit and debit cards, and alternative payment methods from around the world. By April 2024, PayPal added new features to its complete payments solution for small businesses to enable small businesses to accept a range of payments including PayPal, Venmo and PayPal Pay Later products. PayPal also gave small businesses access to four new features to help them drive payment acceptance and enhance how they run their business, and this will include Apple Pay as a checkout option.

Digital Payment Services

In the Yearbooks, digital payment services are classified as card-based payment services using EMV tokenisation security on the internet combined with HCE NFC technology in the case of contactless payments at POS terminals.

As of mid-2024, the Click to Pay online payment checkout service was not yet available in Russia. Click to Pay replaced the previous MasterPass and VISA Checkout services respectively. Click to Pay is a joint service between Mastercard, Visa, Discover, and American Express, enabling consumers to make secure one-click payments without having to enter card details or passwords online.

Until early 2022, contactless payments on cards using Apple Pay, Samsung Pay, or Google Pay (previously Android Pay) made by foreign users at contactless POS terminals in Russia were processed as payments on contactless cards. However, in March 2022, Apple Pay and Google Pay suspended support for contactless mobile payments made using Mir cards issued by Russia’s National Payment Card System following Western sanctions.

Global contactless transaction values will reach $10 trillion by 2027, up from $4.6 trillion in 2022, with contactless mobile and wearable payments expected to grow by 221% and contactless card payments by 119% over the same period.

Contactless ticketing spend will increase by more than 440% globally between 2022 and 2027, with growing prominence and support for OEM pay solutions, such as Apple Pay, Google Pay and Samsung Pay being a key enabler for mobile NFC ticketing across many markets.

Overall growth in contactless transaction values will be catalysed by growing mobile payments adoption, with 99% of all smartphones capable of making contactless payments by 2027, up from 94% today, and average transaction values for Apple Pay reaching $28.20 and $33.40 for Google Pay.

Apple Pay has become one of the world’s most used digital payment methods. Its user base increased from 521.4 million to 535.8 million in 2022.

According to Apple’s Q2 last 2021, they saw a record of transactions with more than 1.8 billion processed during the quarter, up 40% year-over-year. This payment method is also available in over 90% of the US and 60% of stores globally.

Around 51% of global iPhone users have enabled Apple Pay in 2022. There are 10 million Apple Pay-friendly contactless payment terminals worldwide.

The transactions made using Apple Pay are mostly in-store purchases, online transactions, and peer-to-peer payments. It is trendy for contactless payments, especially during the COVID-19 pandemic.

There were about 38 million Apple Pay users in the United States as Apple Pay has gained popularity since its launch in 2014, accounting for 43.2% of mobile payment users. These numbers expect to increase and grow up to 101.2 million this 2023.

Putting it all together, Apple Pay is increasingly becoming an effective customer acquisition and retention feature for Apple. In June 2022, Apple Pay added Apple Pay Later, its own buy-now-pay-later service, allowing users to split purchases into four equal instalments with no interest or fees. Initially launched in the US, the service is expected to roll out to other countries during 2023. In 2023, Apple launched its Card savings account from Goldman Sachs with a 4.15% annual percentage yield. Apple Wallet users can set up and manage a savings account directly from Apple Card in Wallet, with no fees, no minimum deposits, and no minimum balance requirements.

In October 2016, Apple Pay began rolling out across Russia, and as of 2021, most Russian banks supported Apple Pay. In July 2021, Apple Pay was made available for MIR cardholders in Russia. As of early 2022, Apple Pay suspended operating in Russia due to the Ukraine conflict. Apple Pay also suspended the use of MIR cards in Apple Pay, closing a loophole that let Russians continue to use the service amid economic sanctions on the country.

Google Pay has 150 million active users across 42 global markets.

In January 2022, it was reported that the company was planning to transform Google Pay into a “comprehensive digital wallet”, following the app’s reported slow growth and the shutdown of Plex. In April, it was reported that Google was planning to revive the “Google Wallet” branding in a new app or interface and integrated with Google Pay. Google officially announced Google Wallet on May 11, 2022, at the 2022 Google I/O keynote. The app began rolling out on Android smartphones on July 18, replacing the 2018 app and co-existing with the 2020 Google Pay app in the US. While the app name itself was changed from Google Pay to Google Wallet, the service name of actually paying for things online or in-store remains “Google Pay.”.

In the US, Google Pay has over 25.2 million users.  Also, Google Pay is used on nearly 800,000 websites as a secure payment gateway. Roughly 20% of all mobile purchases are made using this digital payment processor.

In May 2017, Google launched Google Pay in Russia, and as of mid-2021 was supported by Mastercard, VISA, and the same Russian banks that support Apple Pay. As of March 2022, according to market research data, the largest number of people making online payments using Google Pay lived in Russia (29%). In early 2022, Google Pay suspended services in Russia.

Samsung Pay is available in 29 countries worldwide and has an estimated 140 million users. Samsung Pay works with Galaxy phones, including the latest Galaxy S22. Samsung claims that its system will work with almost all point-of-sale systems: NFC, magnetic stripe, and EMV (Europay, Mastercard and Visa) terminals for chip-based cards.

In June 2022, Samsung Pay announced the launch of Samsung Wallet, enabling users to organise payment, loyalty and gift cards into one app. In October 2016, Samsung Pay launched in Russia, and as of mid-2021, 35 banks participating in the MIR payment system were connected to the Samsung Pay service, ensuring its accessibility for holders of national payment instruments.

In December 2021, Samsung Pay customers in Russia were enabled to use their smartphones as a virtual Troika transit card, made possible through a collaboration with Google, VTB Bank, Mastercard, and Mosmetro. The virtual Troika transit card could be added to any Samsung phone that offers compatibility with Samsung Pay via NFC, allowing customers to use their phones to make payments at public transport payment terminals in Moscow.

As of August 2023, it was reported that Samsung Pay was still operating in Russia. Samsung affirmed in March 2022 that it will continue servicing Russian users and that contactless payments with Russian MIR cards will work in Samsung Pay without restrictions.

Huawei Pay – In January 2018, Chinese Huawei and UnionPay announced plans to launch Huawei Pay in Russia and other markets along the “Belt and Road Initiative”. Huawei Pay uses biometrics and NFC technology to enable in-store payments through Huawei smartphones. In July 2018, Huawei Pay launched in Russia with the supported of VTB Bank. In 2019, Huawei Pay expanded its services online, with UnionPay cardholders from Gazprombank and the Russian Agricultural Bank the first to experience mobile payment services on Huawei and Honor smartphones.

In September 2020, the Moscow Metro began accepting Huawei Pay, allowing passengers to use NFC-enabled Huawei smartphones to make fare payments at every station in the Moscow Metro network. Huawei Pay supports UnionPay credit and debit cards issued by several partner banks in Russia.

Overview of Cashless Payments

According to the CBR, in 2023, the share of non-cash payments for goods and services in retail turnover exceeded 83%, compared to 78.1% in 2022. The number of non-cash transactions increased by 14.6% from 2022, comprising 91.1 billion transactions, while value fell by 8.6% to RUB 1455.6 trillion.

Cards accounted for 86.11% of non-cash transactions in 2023, compared to 57.29% in the EU. Credit transfers and other payment instruments accounted for 10.11% and 3.57% by number, respectively. Credit transfer is the dominant means of payment in terms of value. Direct debits were only 0.22% by number.

Cheques are not a commonly used payment instrument in Russia. They are typically used by companies for cash withdrawals. All cheques are cleared and exchanged bilaterally between banks.

In 2023, there were 635.7 cash-less payments per capita composed of 519.0 card payments, 28.4 e-money transactions, 64.2 credit transfers, and 22.7 direct debits.

6 - Leading Card Issuers in Russia
Domestic Issuers	Issued Card Brands	Owned by
Sberbank	Mastercard, VISA; Electron; MIR	State (CBR): 50%+1 voting share, investors
VTB Bank	Mastercard, VISA; MIR	State: 60.93%, investors
Alfa Bank	Mastercard, VISA; MIR	five private investors (RUS): 86.2%,Charity: 3.8% UniCredit (I): 9.9%
Russian Standard Bank (RSB)	Mastercard, VISA, American Express, Diners, UnionPay; VISA Debit; MIR, Daricard	Russian Standard Corp.: 99.92%
Promsvyazbank (PSB)	Mastercard, VISA; MIR	State Rescue Scheme Implemented Feb 2019
Gazprombank (GPB)	Mastercard, VISA, JCB, UnionPay; Electron; MIR	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others
Russian Agricultural Bank	Mastercard, VISA, JCB, UnionPay; MIR	State: 100%
B&N Bank	Mastercard, VISA; MIR; Zolotaya Korona	State Rescue Scheme Implemented late 2017
Uralsib Bank	Mastercard, VISA, American Express	2017: Vladimir Kogan: 81.81%, other individuals (RUS)
Tinkoff Bank (TCS)	Mastercard	private individual: 54.77%, investors: 14.82%, free float: 30.41%
UniCredit Bank	Mastercard, VISA; MIR	UniCredit Group (I): 100%
Rosbank	Mastercard, VISA; Electron; MIR	Société Générale (F): 99.95%
Raiffeisenbank	Mastercard, VISA; MIR	Raiffeisen RBI Group (A)
Home Credit Bank	Mastercard, VISA; MIR	Home Credit Group (NL)
other banks	Mastercard, VISA; MIR	other bank owners
Note: the Russian banks use the VISA and Mastercard brands for debit cards, delayed debit card and credit cards, respectively.
Note: in addition Russian banks may issue domestic cards branded Zolotaya Korona, UEC, or local mono-line payroll cards.
Note: Russian Standard Bank is the exclusive issuer of AmEx Centurion since 2005.
Source: PCM research

Exchange Rates

The currency of Russia is the Russian rouble (RUR). The Rouble: dollar exchange rate remained relatively stable during 2013. In 2014 and 2015, Rouble weakness developed with the imposition of western sanctions and by end-2016 had dropped to $1: RUR 60.66, a devaluation of almost 100%. In 2016, there was another devaluation by 10.3% to $1: RUR 66.9. In 2017, the rouble recovered to $1: RUR 58.33 but dipped in 2022 to $1: RUR 73.64 and further dipped to 84.65 in 2023.

7 - Leading Acquirers in Russia
Domestic Acquirers	Acceptance Brands offered	Owned by
Sberbank	Mastercard, VISA, JCB; Electron; MIR	State (CBR): 50%+1 voting share, investors
VTB Bank	Mastercard, VISA, JCB; Electron; MIR, Alipay, UnionPay	State: 60.93%, investors
Gazprombank (GPB)	Mastercard, VISA, JCB; Electron; MIR	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others
Russian Standard Bank (RSB)	Mastercard, VISA, American Express, Diners, Discover, JCB, UnionPay; Maestro, Electron; MIR	Russian Standard Corp.: 99.92%
United Card Service (UCS)	Mastercard, VISA, JCB, UnionPay; Electron; MIR	Global Payments Europe (UK)
Alfa Bank	Mastercard, VISA; Electron; MIR	five private investors (RUS): 86.2%,Charity 3.8% UniCredit (I): 9.9%
B&N Bank	Mastercard, VISA; Electron; MIR	State Rescue Scheme Implemented late 2017
Promsvyazbank (PSB)	Mastercard, VISA; Electron; MIR	State Rescue Scheme Implemented Feb 2019
Russian Agricultural Bank	Mastercard, VISA, JCB; Electron; MIR	State: 100%
other acquirer banks	Mastercard, VISA; Electron; MIR	other bank owners
Note: in addition, Russian acquirers accept Zolotaya Korona cards and local debit cards at their respective ATMs and POS terminals.
Note: Uralsib also acquires American Express
Source: PCM research

Market Infrastructure

The lack of legacy infrastructure in Russia enables banks to be more agile from a technology and cultural point of view. Thus, market players claim that the infrastructure and processing systems are newer and more transparent than in Europe. Bank consolidation, big company innovation, lack of legacy systems and a so-called can-do business culture make for a dynamic, competitive and innovative Russian market (see FinTech association below).

According to market insight, digital banking services delivered to Russian customers are advanced in terms of functionality, such as security services, one-time PIN codes, geo-blocking, cash withdrawal limits, and card-less ATM cash withdrawals by code.

In 2015, the Russian government introduced the first phase of legislation to prevent tax evasion in the retail sector. Specific retailer segments were required to install 2D-scanners to scan products sold, e.g. bottles of alcohol. From mid-2017, all medium-sized retailers across Russia were required to provide real-time, line-by-line reporting of all items sold. This is to control goods purchased against those sold for tax purposes.

According to the CBR, in 2022 the Russian payment market demonstrated steady growth, with the CBR, credit institutions, and other payment service providers continuing to develop their payment infrastructure. In 2021, the CBR approved the National Payment System Development Strategy for 2021–2023. Its primary objective is to provide convenient and affordable payment services to people, businesses, and the government.

Furthermore, the CBR continued to advance the MIR national payment system and the Faster Payments System (FPS). The use of MIR national payment cards, as well as the processing of transactions on the cards of international payment systems in the National Payment Card System (NSPK), ensured the accessibility of cashless payments on all types of cards inside Russia. Owing to bilateral agreements with other countries on the acceptance of MIR cards, Russians were able to continue to make payments with these cards in 10 countries, including all EAEU states.

The National Payment System comprises 27 payment systems, 60 e-money operators, 473 payment operators, and more than 500 payment agents. In January 2019, the Faster Payments System was launched, which comprised 221 credit institutions as of January 2024.

Central Bank of the Russian Federation (CBR)

CBR, also known as the Bank of Russia, plays a key role in the country’s payment systems, as the ultimate supervisor and as operator of the Bank of Russia Payment System (BRPS), which is part of the Payment System of Russia.

BRPS is responsible for settling payments by financial market participants, including most interbank payments. BRPS is used for the settlement of large-value and small-value payments; CBR places no limit on the value of individual payments.

The key components of BRPS are the systems for intra-regional electronic payments (VER) and for inter-regional electronic payments (MER); and the Banking Electronic Speedy Payment system (BESP), Russia’s RTGS system. These reflect the unique requirement for the system to operate across Russia’s eleven time-zones.

In 2022, the CBR reported that the number and value of funds transfers through the BRPS increased from 2021 by 1.8 x and 5.7% respectively and amounted to 8.9 billion transfers for a total amount of RUR 3,532.5 trillion. The BRPS handled 26.8 million transfers worth RUR 14.3 trillion on average per day The speedy funds transfers were dominating value wise (89.9%) while the SBP transfers were prevailing in terms of number (80.0%). The share of transfers through the BRPS using the fast payment service in total increased over the year by 3.5x and reached 61.3%.

As of 1 January 2024, 1,477 organisations were members of the BRPS (1,532 as of 1 January 2023), of which 1,069 were credit institutions, 171 were non-credit institutions, and 229 were CBR structural divisions.

On average, in 2023 each member of the BRPS carried out 3.2 million transactions for the amount of RUB 2.4 trillion, which exceeded the values for 2022 by 87.5% and 14.3%, respectively.

In June 2019, the CBR launched Russia’s faster payments (FPS). Under the authority of the CBR, the use of the FPS is mandatory for credit institutions participating in the MIR payment system, which came into effect for systemically important credit institutions in October 2019 and came into force for credit institutions with a universal license in October 2020.

The system reported rapid initial take-up, with over 730,000 transactions for over RUR 6.5 billion processed in the first month of operation. In August 2019, the FPS added a new feature enabling payments to legal entities, for example, for the purchase of goods and services, including transactions involving the use of QR codes. Businesses’ costs for accepting cashless payments via QR codes in the FPS were reduced to 0.4–0.7%. Acquiring fees were limited to 1% for payments for socially important goods and services through 31 August 2022. In 2022, a new structure of fees for services provided in the FPS was introduced, with different fees for different transfer amounts i.e., increased fees for higher transfer amounts.

In 2023, the FPS recorded more than a two-fold increase year-on-year to 7.2 billion transactions worth RUB 31.0 trillion, up from 3.04 billion transactions and RUB 14.4 trillion in 2022. Over 2022, the number of FPS users rose by 37 million, reaching 81 million people. As compared to 2021, the volume and value of transactions in the FPS surged 3.5 x and 2.8 x, respectively in 2022.

As of January 2024, there were 221 credit institutions were connected to the SBP. The system had processed over 6.9 billion transactions worth RUR 32.7 trillion.

Concurrently, the CBR’s Financial Messaging System (SPFS) enabled the processing of financial messages on operations inside Russia (instead of SWIFT), as well as supporting communication with 12 countries. In 2023, the total number of messages in the SPFS doubled relative to the 2022 traffic. The number of FMS users reached 556 organisations (banks and companies), organisations, over a quarter of which were non-residents (159 foreign institutions from 20 countries).

In addition to the transfers of funds between individuals (C2C2 transactions) and to legal entities for goods (C2B3 transactions), the FPS provided for the option of transferring funds from legal entities to individuals (B2C4 transactions) as well as transfers between accounts of the same individual with different banks at the beneficiary’s initiative (C2C-pull5 transactions).

To minimise the costs of credit institutions for the creation of their own mobile apps and to promote competition in the payment services market, a mobile app for the FPS was created.

To reduce the cost of transfers for households and the costs for the acceptance of cashless payments by businesses, the CBR established a new fee structure:

• The maximum fee to be charged by banks to customers that are beneficiaries under C2B transactions: no more than 0.7% or, for socially significant categories (medical, educational, insurance, transport and other services), no more than 0.4%.
• The maximum fee to be charged by banks to individual customers for C2C transactions: up to RUR 150,000 per month – free of charge; over RUR 100,000 – 0.5% of the transfer amount (but not more than RUR 1,500 for a transfer).

In addition, the CBR set zero tariffs on the part of banks for C2C transactions, and tariffs of RUR 0.05-3.00 for C2B and B2C transactions (depending on the transfer amount).

To increase the accessibility of payment services for households and businesses, CBR Regulation No. 732‑P2 stipulates the deadlines for banks to implement the scenarios for transferring funds to the FPS:

• For systemically important credit institutions: starting 1 October 2021 for C2B, B2C and C2C-pull operations.
• For other credit institutions holding a universal licence that are members of the Mir payment system: starting 1 October 2021 for C2C-pull operations and starting 1 April 2022 for C2B and B2C operations.

As of the end of 2023, the system was able to support the following types of transactions: C2C (including С2С-pull1), C2B, B2C,2 B2B,3 and C2G,4 as well as cross-border transfers between individuals via foreign correspondent banks of Russian banks participating in the SBP.

The network of card acceptance devices was complemented by 129.900 cash desks and payment terminals of payment agents (subagents) and 323,400 cash desks and cash deposit machines of bank payment agents (subagents). In 2023, the infrastructure of bank payment agents (subagents) processed 212.7 million individuals’ cash-in transactions totalling RUR 403.7 billion. Customer-to-business (C2B) transfers prevailed in terms of number (83.6%) and customer-to-customer (C2C) transfers dominated in terms of value (59.8%). Using electronic means of payment, credit institutions’ clients made 4.2 billion electronic funds transfers in the amount of RUR 4.3 trillion (up 21.6% and 42.5% in terms of number and value, respectively).

Law ‘On the National Payment System’

In its supervisory role, CBR is responsible for administration of the federal law adopted in June 2011, ‘On the National Payment System’ (161/2011). This legislation establishes the legal and organisational foundations for the national payment system, regulates procedures for providing payment services and for supervising and monitoring the system. All types of electronic payments are regulated under the legislation, including mobile payments.

The law defines the procedures and features for conducting electronic monetary transfers, including a payment system operator’s right to use processing centres located outside Russia for providing services to payment system participants – a proviso added after lobbying by VISA and Mastercard.

Earlier drafts of the law required processing centres to be Russia-based. In the final version, services must be regular in nature, regardless of the location of the processing centre, and fulfil size criteria. The intention is to create a level playing field between all payment systems, with international and national players required to have their rules, and any changes to them, approved by the central bank.

Summing up in its banking supervision report, CBR said that 27 payment systems operated in Russia at end-2023, compared with 20 in 2012, of which two were systemically important – the Bank of Russia payment system and the Non-Banking Credit Organisation National Settlement Depository (NSD). Four payments systems – Contact, VISA, Zolotaya Korona “Golden Crown” and Mastercard – were classified as socially important.

In September 2014, CBR also recognised the National Clearing Centre (NCC) as systemically important infrastructure for Russia’s financial market. However, in 2019, NCC was excluded as a payment system operator.

CBR was required under the federal payments legislation to undertake a due diligence process in relation to players such as payment gateways, aggregators, e-money institutions and e-wallets to assess their fitness to hold the necessary licence to operate, which is similar to a banking licence but is limited to non-credit financial activity.

Introduction of the Universal Electronic Card (UEC), a universal citizen e-ID card for access to government and municipal benefits and services, including state medical insurance and pension entitlements, originally formed part of the National Payment System law, but ceased operation in 2019. (see Appendix).

CBR is also responsible for the federal law adopted in July 2012, ‘On Amending Some Russian Laws,’ which inter alia requires credit institutions to create and maintain electronic databases.

In 2019, the Russian government and the CBR implemented a series of new laws aimed to strengthening digital payments and services. Federal Law No. 34‑FZ5 addresses the legal status of electronic transactions, digital rights and smart contracts Federal Law No. 259‑FZ7 establishes a legal framework for using digital technologies to raise financing and investments with guarantees from platform operators. Federal Law No. 476‑FZ9 improves regulation in the area of electronic signatures, introduces the institution of a trusted third party and created a certification centre of the CBR for issuing electronic signatures to credit institutions, payment system operators, non-bank financial institutions and CBR officials. In addition, this law makes it possible to obtain and use a cloud-based electronic signature through the Unified Biometric System.

National Payment Card System (NSPK)

The CBR has responsibility for the development and operation of Russia’s National Payment System, following signature by President Putin of the ‘NSPK’ law in May 2014. Putin’s determination to reduce Russia’s dependence on western financial systems led to the creation of the National Payment Card System, NSPK, which was established in response to the US sanctions which required VISA and Mastercard to block transactions by certain named banks (including Bank Rossiya, SMP Bank, Sobinbank, and InvestCapitalBank).

Relevant amendments to Federal Law No. 161-FZ “On the National Payment System” of 27 June 2011 were made to provide for the establishment of the National Card Payment System.

The NSPK law requires all processing to be carried out within Russia and states that payment system operators may not unilaterally abandon the provision of services necessary to give effect to payments. In its original form, it required foreign payment systems to pay a so-called security fee, making quarterly contributions equivalent to 25% of average daily turnover to a special CBR account from July 1 2014, though this was subsequently reduced to 10%.

Then-Prime Minister Dmitry Medvedev said the national payment system would work alongside the existing operators, not replace them. CBR envisaged the cards being co-branded with China UnionPay, JCB, VISA and Mastercard for overseas functionality. The system was said to be based on the infrastructure of one of the existing payment systems – Sberbank’s PRO100 or Zolotaya Korona (Golden Crown).

CBR holds 100% of the shares of the National Payment Card System (NPCS), which was founded in July 2014. The process of the NPCS deployment was divided into three stages.

• The first stage established the operations and payment clearing centers for international payment systems transactions, building-up banks interaction infrastructure and adjusting the operating system. By the end of March, 2015, NPCS platform should’ve been able to process all the transactions provided by VISA and Mastercard.
• In H2 2015, the Russian system was supposed to issue proprietary payment cards, so that Russian citizens could use them to make payments nationwide.
• The third stage, planned after 2016, implied the expansion of Russian payment cards usage in foreign markets and their integration in other payment system infrastructures.

Step1 – Transmission of the processing of major international payment systems to the NPCS operation clearinghouse 

By late 2014 neither the Russian domestic rules nor the precise legal impact of the sanctions were entirely clear. However, in comments made in August 2014, Mastercard indicated that it expected Russia’s revised rules to enable it to continue processing payments with a Russian-based partner.

In January 2015, five Russian banks agreed to start processing domestic Mastercard payment transactions via the National Payment Card System (NCPS) processing center implementing settlements on these transactions through CBR. CBR did not specify the five banks although it had been reported that Gazprombank, Rosbank, Alfa Bank, Bank Rossiya, SMP Bank, and Ural Bank for Reconstruction and Development would be the contenders to pioneer the program.

The law which established NPCS took effect in 2014, after a number of Russian banks became subject to EU and US sanctions. As such, the banks’ client cards were temporarily blocked by VISA and Mastercard.

In January 2015, Mastercard signed a deal to transfer domestic Russian transaction processing to the country’s new national payments system. Under the agreement, Mastercard would gradually transfer all transactions to the NPCS with the CBR carrying out settlement services. Mastercard was obliged to switch processing to the new system in order to avoid handing over a massive security deposit.

In February 2015, the NSPK and VISA concluded a bilateral agreement on operating and clearing services on domestic VISA payment system card transactions to be provided by the NPCS processing center. CBR, NPCS and VISA also concluded a trilateral agreement determining the procedure for providing card settlement services through the Bank of Russia.

Step2 – Launch of national payment cards branded ‘MIR’

From April 2015, the processing of any domestic transaction made with a card of any payment system, including international payment systems, within Russia occurred through the NSPK Transaction Settlement and Clearing Center (NSPK TSCC). In December 2015, the first domestic MIR payment cards were issued.

In December 2015, 35 Russian banks agreed to participate in the launch of a new national payments card intended to challenge the dominance of VISA and Mastercard.

Seven of the banks tested the basic functions of the new ‘MIR’ card in their infrastructure for cash withdrawal and deposits through ATMs, payment for goods and services, and fund transfers between cards. Another group of banks was to complete tests by the end of 2015.

The new ‘MIR’ cards bore the branding of Mastercard, JCB, American Express and UnionPay under a ‘co-badging’ agreement to ease their acceptance in the market during the pilot phase and to allow for transactions in overseas markets.

Agreements on issuance of co-badged cards under the brands of MIR-Maestro, MIR-JCB and MIR-AmEx were signed.

Step3 – Cross-border acceptance of cards branded ‘MIR’ in the CIS region 

In August 2017, the Russian and Armenian payment systems integration project was completed. The project envisaged mutual acceptance of the two national payment systems’ cards in their infrastructures, i.e. MIR Cards in Armenia and Arca Cards in Russia. VTB, Alfa Bank, Tsentr-Invest and Uraltransbank were the first participants in the project. Since then, MIR is now also accepted in South Ossetia, Abkhazia, Turkey, Belarus, Kyrgyz Republic and Uzbekistan, with plans to expand acceptance in Vietnam, Thailand, Cyprus and the UK. In February 2020, MIR announced its acceptance in Tajikistan.

Association of Banks of Russia

At present the Association collaborates with regional banking unions of 52 Federal entities and 13 ARB representative offices based in other regions of Russia. As of August 2024, the Association of Banks of Russia (ABR) has more than 220 members including 144 Banks and 76 non-banking organisations.

ARB is the focal point for coordination of banking and payment card activities, and is a founding member of NBKI, the National Bureau of Credit Histories (see Appendix). The key role of ARB is reviewing and promoting legislation in the State Duma (Parliament) and liaison with government bodies.

FinTech Association

The Russian government is committed to creating a strong FinTech community to rival other global innovation hubs, and domestic banks are playing their role in providing start-ups with know-how and backing.

Representatives of the Bank of Russia, CBR, and major financial market participants approved the decision to found an Association for Financial Technologies Development (FinTech Association). The meeting held on 28 December 2016 also approved the Association’s charter, the composition of its founding members and the Supervisory Board. The Association started operations in January 2017.

According to the CBR, the Association’s key objectives include the development and introduction of digital technological solutions to ensure the development of the Russian financial market. It will also promote digitalisation of the Russian economy.

The Association’s participants will seek to study and introduce the most promising technologies, including distributed ledger, open application program interface (Open API) and remote identification technologies, as well as to create a single payment space for households and legal entities.

In September 2019, the inaugural Sino-Russian Financial Cooperation Roundtable kicked off in Vladivostok, Russia. Nearly 200 people attended the meeting held jointly by Asian Financial Cooperation Association (AFCA), the Association of Banks of Russia, China Economic Information Service (CEIS), and the Harbin New Area Management Committee. The purpose of the meeting was to discuss future collaborative efforts between Russia and China in the digital delivery of financial services.

In July 2021, Promsvyazbank and Tochka, a FinTech service for small businesses, started using Open Banking APIs developed by the CBR and the Russian FinTech Association. The first use case for open APIs in Russia will be SME account data exchange between banks.

The CBR approved the first recommended standards for Open Banking in October 2020. They include API standards for account information, payment initiation as well as information security standards. The Russian FinTech Association carries out pilot projects with local banks and FinTechs in order to test the standards in real business cases.

National Payments Council Association

Following promulgation of the payment system law, some of the leading players banded together in January 2012 to form the National Payments Council (NPC), whose purpose is “to promote the orderly and rapid development of the Russian payments industry, as well as improve the economic and social role of the payment industry in Russia”.

Founder members of the association were Zolotaya Korona, the largest inter-regional payment organisation, Mastercard and VISA. In July 2012, four new members joined the council: Uralsib Bank, United Card Services (UCS), Customs Payment System “Green Corridor” and VTB24 Bank.

The Council is acting on those objectives through special committees that liaise with the Russian Government’s main institutions to support the latest legislation on payments, including the Government of Russian Federation, the State Duma, Reserve Bank of Russia and others. They also cooperate closely with international associations and governance bodies to retrieve the best practices on payments.

In 2023, the members of the Management Board of Russian National Payments Council Association were Zolotaya Korona, Mastercard, VISA and MTS. The members of the Council included United Card Service (UCS), VTB24 Bank, Bank of Moscow, Svyaznoy Bank, CyberPlat, the E-money Association NPAED, and PayPal. Current objectives include the development of new products, the modernisation of payment systems, the development of innovation and the development of new industry standards.

Customs Payment System “Green Corridor”

The Customs Payment System “Green Corridor” was a smart card-based system that allows traders to make customs and other payments required for the clearance of goods directly to customs posts. Payments could be made online 24/7 using CPS terminals installed in customs offices.

VTB Bank issued the Green Corridor custom payment system cards. The bank said that with these cards, cardholders could avoid advance payments, thus minimising financial and labour costs. The cards enabled additional payments to be made in the event of adjustments to the custom cargo value, while several cards could be used at the same time, linked to a single banking account. Card accounts were denominated in roubles.

According to CPS, the cards could be deployed as a marketing tool by banks to build customer loyalty. The potential market consisted of more than 40,000 companies participating in foreign trade, with total customs payments said by CPS to be more than RUR 3.5 trillion in 2009, citing figures from the Federal Customs Service. In 2014, VISA, BPC Banking Technologies and Multiservice Payment System announced the launch of a service enabling customers to make customs payments with VISA cards. The service was in operation at all Moscow airport customs points and was planned to expand to the entire customs network of Russia. With this service VISA cardholders could make customs payments by scanning codes at customs points, eliminating manual customs forms completion. According to Multiservice Payment System, in 2013, more than 450,000 customs payments were made by individual customers, for an average amount of $2,000.

CONTACT

The CONTACT money transfer and payment remittances system was established in 1999 (see Appendix for background). From August 27 2014 to April 27 2017, Rapida was the operator of the CONTACT system.

On March 17 2017, the Bank of Russia registered QIWI Bank as the operator of the CONTACT Payment System in a unified register of payment systems operators. Simultaneously, the Bank of Russia excluded NCO “Rapida” from the list of payment system operators. Both financial institutions were parts of QIWI Group.

On April 27 2017, a record of the completion of the reorganisation of QIWI Bank in the form of the merger with Rapida Ltd. was made in the Unified State Register of Legal Entities (EGRUL). Since April 28, 2017, Rapida ceased to operate as a legal entity, all of its rights and obligations were transferred to the CBR in the order of universal succession.

The CONTACT system laid the foundations in the Russian market for remittances and is currently one of its leaders in Russia and CIS countries. CONTACT’s pool of partners consists of more than 700 financial institutions in Russia and more than 200 agents abroad, which form an extensive network of service points – 500,000+ POS, including payment terminals, in more than 180 countries. The CONTACT system also processes payments to more than 2,500 legal entities – commercial banks, trading companies, insurance and travel companies and their agents, Internet service providers, and telecom operators. CONTACT system laid the foundations of the Russian market of remittances and is currently one of its leaders in Russia and CIS countries.  Annually millions of customers worldwide use the system’s services. As of 2021, over 30% of the total amount of international transfers sent to Russia were made through CONTACT. In 2022, CBR temporarily suspended the publication of cross-border transfers of Individuals.

Zolotaya Korona “Golden Crown”

Zolotaya Korona (Korona Pay) is an inter-regional, interbank money transfer system and card payment network. It was created in 1994 by Centre of Financial Technologies (CFT), which claims market leadership in the ranking of Russian IT companies developing IT-solutions for financial institutions. CFT has been operating in the Russian IT market since 1991, with processing services being one of its three core business fields.

KoronaPay is operated by the Credit Union “Payment Centre”, which acts as a settlement centre for Korona Pay money transfer. Credit Union “Payment Centre” is licensed and regulated by the CBR. Both KoronaPay and Credit Union “Payment Centre” are part of CFT.

KoronaPay is the largest payment system in Russia. The cash money transfer service has been in the business of transferring money without an account since 2003 and renders its services in Russia, CIS, and other countries. Since 2013, Korona Pay has been classified by CBR as a socially important payment system, along with Contact, VISA and Mastercard.

The service is available in over 50 countries through 550 banks and 50,000 service points, and the KoronaPay app is used by 17.5 million customers. In May 2020, KoronaPay Europe launched in the European Economic Area amid the COVID-19 pandemic. In the year following the first transaction in Europe, turnover increased 20-fold while the number of transactions surpassed 50,000 per month. By 2021, KoronaPay Europe had 13 million users and reached $1 billion in monthly remittances. In March 2022, KoronaPay suspended its operation with international money transfers from cards issued by several Russian banks. This is due to the decision of the company’s partners who do not want to breach sanctions. Holders of cards issued by Tinkoff, Sber, and Alfa Bank can no longer make any international money transfers with the help of Zolotaya Korona.

Via the Zolotaya Korona system, remittances are transferred all around Russia and the Eurasian region. Banks in Ukraine, Moldova, Armenia, Kazakhstan, Georgia, Tajikistan, Uzbekistan, and Kyrgyz Republic participate in the system, as well as Azerpost, the Azerbaijan postal services network. As well as its dominant position in Russia, Zolotaya Korona has become a key player in other countries. In 2021, it claimed to be the most popular money transfer system in Tajikistan, handling 80% of incoming remittances.

In addition to the core business of processing remittances, Zolotaya Korona has also developed credit card services under the Golden Crown brand and claims that 8 million people use its cards for everyday spending, amounting to 25 million transactions per month.

In April 2012, Zolotaya Korona and Mastercard announced cooperation to create a jointly run debit card bearing both companies’ branding and accepted in both systems. Equipped with magstripe and chip functionality, the cards were launched in June 2012 in a pilot by Sovcombank, the largest existing issuer of Golden Crown cards, with a card base of about 1 million. Sovcombank expected to issue 4 million of the new cards over the next three years and said it would extend the branding to its credit and payroll cards in future. However, by Q2 2014, Sovcombank was no longer issuing credit cards.

According to comments by Zolotaya Korona’s technical director, the partnership with Mastercard was viewed as long-term and strategic, with the aim being to consolidate technologies, infrastructure, client base, resources and marketing programmes. Within five years, issuance of 30 million Mastercard-Golden Crown cards was forecast.

The partnership was also expected to enable Mastercard to develop a regional customer base and increase its share of the Russian market, while Zolotaya Korona would gain access to international markets. Cardholders would pay with Zolotaya Korona where its golden crown decal was displayed, or otherwise with Mastercard.

Among other key relationships, the ATM network of B&N Bank was open to Golden Crown cards, and acceptance of Golden Crown cards was extended to merchants serviced by Russian Standard Bank.

Since 2006, the Zolotaya Korona brand has encompassed a range of cards and payment services – bank cards, credit cards, prepaid cards, social and transport cards, and charges for housing, public utilities and remittances. Zolotaya Korona cards are also used for non-cash payments for transport in a number of Russian regions.

Card Issuers – Overview 

The Russian banks issue credit cards, charge cards, debit cards and prepaid cards in combination with bank accounts. Addressing the specific needs of personal banking and business banking, the card portfolio is composed of consumer cards, business cards and corporate cards.

Dedicated card products are offered for the individual client segments: families, millennials, students, affluent clients, small business clients, corporate clients, and even basic account clients. The credit cards offered range from classic cards to gold cards and platinum cards.

According to the CBR, 229 of the 324 banks issued cards in Russia as at end-2023. The major banks issue contactless cards, debit cards branded MIR, Mastercard, Maestro, VISA, VISA Debit or Electron, and delayed debit cards and credit cards branded Mastercard or VISA. By the end of 2022, 158 Russian banks issued MIR cards, and more than ten banks issued UnionPay cards.

The multi-brand issuer, Russian Standard Bank (RSB), issues American Express cards, Diners Club cards, Discover cards, and UnionPay cards. Dedicated Zolotaya Korona (ZK) cards are issued as specific money transfer cards for expatriates.

From 2017, many Russian banks support Apple Pay, Samsung Pay and Google Pay (Android Pay).

The leading issuers in Russia can be divided into two groups. On one hand, the large universal banks which issue consumer cards for individuals and corporate cards for business. On the other hand, there are the consumer credit specialist banks like Russian Standard Bank, HCF Bank and Tinkoff Bank.

The leading card issuer banks are Sberbank, VTB Bank Group, Russian Standard Bank, Alfa Bank, and Zolotaya Korona (for other major issuer banks see below). Table 8 illustrates the card brands issued by the Russian banks as at mid-2024.

8 - Leading Russian Acquirers - Key Figures 2023
Domestic Acquirers	Acquired Volumes		Merchants serviced		thereof online merchants serviced
	payments (m)	value ($bn)	outlets	POS terminals	payments (m)	value ($bn)	in % of total of acquired value
Sberbank	3,766.9	99.8	1,486,368	2,352,325	3,821.6	59.9	60.07%
VTB Bank	1,308.3	17.8	200,482	408,319	601.7	10.4	58.46%
Gazprombank	500.0	4.7	37,382	47,755	51.0	2.4	51.06%
Tinkoff Bank	200.0	3.4	78,187	51,380	64.0	2.1	61.76%
Russian Standard Bank	126.3	2.4	45,952	58,562	85.2	1.8	75.00%
Promsvyazbank	118.2	1.9	29,630	55,588	62.8	1.3	68.42%
Note: acquired payments by number and value are by VISA and Mastercard cards. Online payments include all card brands.
Note: POS terminals may include double counting of POS terminals.
Source: annual reports, PCM research.

The majority of payment cards in Russia are issued by Sberbank and the enlarged VTB Group. In 2020, they issued the largest number of valid cards, reporting 153.8 million and 29.2 million in circulation, respectively.

Other substantial card bases are those of Russian Standard Bank (25.4 million cards issued, since 2004), Zolotaya Korona “Golden Crown” (8 million money transfer cards used for everyday spending), and Alfa Bank (26.1 million cards).

There is a further tier of private banks with around 1 million up to 5 million cards in circulation, including Rosbank, HCFB, B&N Bank, Uralsib Bank, Ak Bars, Raiffeisenbank, Otkrieti FC Bank, and PromSvyazBank.

Tinkoff Bank, a mono-line (branchless) credit card issuer, reported that it had issued over 33.5 million debit cards and 13.1 credit cards in 2023.

Of the other big state banks, Gazprombank reported 2 million cards in circulation and Russian Agricultural Bank reported 4.5 million cards in circulation in 2020.

Outlook – By mid-2024, Russian card issuers face the following notable challenges:

• The suspension of VISA and Mastercard operations in Russia
• Launch of contactless stickers attached to a mobile phone
• Launch of Debit Mastercard cards and VISA Debit cards replacing Maestro cards and V PAY cards
• New card features such as variable recuring payments (VRP) and buy-now pay-later (BNPL)
• Rollout of contactless cards and online/mobile bank payment services combined with mobile apps
• Implementation of 3D-Secure 2.3; launch of digital wallets, in-app payments, in-store payments
• Competition from card-less payment service providers: PISPs, AISPs, FinTechs
• Tokenisation security combined with HCE NFC and card credentials stored-on-file
• Open Banking ecosystem and demanded access to card accounts (XS2A)

Card Processing and PSPs

In Europe, the payment processing industry is composed of card processors, ATM/POS network hub processors, e-/m-payment service processors (PSPs), and specialised processors (e.g. CSM processors, TSM services).

In Armenia, card issuer processing services range from technical issuer processing, including card printing, to full cardholder processing services. They include all types of cards and card technologies allowing for card use at multiple channels (i.e. at ATMs, POS terminals, on the internet and in-store – mobile payments in the future).

Acquirer processing services in the country range from technical acquirer processing, including POS terminal services, to full merchant processing services.

The leading card processors in the Russia are United Card Services (UCS) and Sberbank, MultiCarta (Post Bank) and Alfa Bank. UCS was originally established by Intourist, but subsequently passed through a number of owners before coming under the ownership of Global Payments Europe from the UK (see below). Sberbank, Alfa Bank, GazPromBank, Bank UralSib and Bank of Moscow have the largest in-house processing centres.

Credit Union “Payment Centre” is the operator and processing centre of the payment system Zolotaya Korona (Korona Pay). From 2017, Qiwi is the operator and processing centre of the Contact payment system.

RuCard is the strategic partner of around 200 banks. It processed over two million international and local cards. Its network is connected to more than 45,000 ATMs and over 25,000 POS-terminals. RUCARD processes card branded: MIR, VISA, MasterCard, American Express, UnionPay as well as processing solutions for local bank cards and loyalty cards.

CompassPlus – In June 2018, CompassPlus, the provider of payment platform and retail banking software solution, TranzAxis, announced the global expansion of its processing business with its fully compliant, Mastercard and VISA certified UK-based processing centre. It also processes transactions on behalf of UnionPay and KoronaPay, and has 25 “strategic partners”, including all of the world’s major card systems and digital payments players. In 2019, it completed projects related to payments processing for clients as far afield as Mongolia, Cambodia, and China.

MultiKarta is a leading Russian provider of processing services. MultiKarta is a partner of the international payment systems MIR, VISA International, Mastercard Worldwide, American Express and UnionPay in Russia, the CIS and Georgia, certified in accordance with PCI DSS.

In 2017, VTB Bank sold a 74,67% stake in MultiKarta to Post Bank (which later increased its stake to 100% in 2018). In October 2021, IT specialist T1 Group acquired a 100% stake in MultiKarta, in a deal worth RUR 1.9 billion. MultiKarta serves more than 50 Russian and foreign banks, including VTB Bank and Post Bank, and processes over 100 million cards and more than 6 billion transactions per year. Also, MultiKarta acts as a service company, providing not only processing, but also technical services for 20,000 ATMs, and 350,000 POS terminals. As of 2023, MultiKarta serviced 50 banks from seven countries (including Russia), processing around 7.5 billion transactions per year from over 100 million cards.

United Card Service (UCS), a subsidiary of card processor Global Payments (US), is the largest card processor in Russia, with a market share estimated in mid-2022 at 20% of transactions carried out by cardholders in Russia.

UCS provides issuing and acquiring services for the cards of major international payment systems such as VISA International, Mastercard Worldwide, China UnionPay, JCB International and MIR, the domestic Russian payment system, as well as for merchants’ local non-bank cards.

It cooperates with all major international payment systems such as Visa, Mastercard, UnionPay and JCB, as well as with Russian United Settlement System (USS) and Zolotaya Korona. Also, UCS is the processors of the local POC card system which consolidates ATM networks, cash points and payment acceptance locations for most credit organisations. In 2021, over 130 banks were using its processing services.

UCS issuer processing in 2016 – 90 Russian and foreign banks used the issuer services and issuer processing services of UCS, which issued 5 million cards on behalf of its clients. UCS processed 455 million cardholder transactions with a total value of RUR 780 billion.

UCS acquirer processing in 2018 – More than 150 banks were acquiring partners of UCS working with the company under a referral or agency scheme, and more than 70,000 merchants used UCS’ acquirer services. UCS processed 272 million acquiring transactions with a total value of RUR 454 billion (figures for 2016; no subsequent updates were provided).

UCS Background – In mid-2013, UCS and Citibank Russia announced a partnership agreement on acquiring services for the bank’s clients in Russia. In late 2011, UCS completed the purchase of Alfa Bank’s acquiring business, increasing its market share by seven percentage points, at a cost of $14.1 million.

In 2012, UCS said its number of retail trade transactions processed was 120 million, with acquiring turnover reported as $9 billion; at the same time, it serviced about 70,000 retail and service businesses. Clients include 157 Russian and foreign banks. UCS has 35 regional offices, which account for 40% of total turnover.

In September 2008, the US processor Global Payments announced an agreement to acquire UCS, including STB-Card, from United Investments, an affiliate of SocGen’s Rosbank. UCS at the time reported $34.2 million in revenues, of which about 55% was from acquiring and 40% from card processing and personalisation.

The deal was completed at end April 2009, with Global Payments paying $75 million in cash to acquire UCS, of which $20 million remained in escrow until January 1, 2013, to satisfy any liabilities discovered post-closing that existed at the purchase date. At the time of the announcement, Global Payments said UCS competed primarily against local banks with an in-house merchant acquiring and/or card processing business.

In December 2007, UCS entered into a 10-year marketing alliance agreement with Rosbank, which provided UCS with VISA and Mastercard bank sponsorship in Russia. VISA and Mastercard bank sponsorship was a barrier to entry for other participants due to licensing restrictions imposed by VISA and Mastercard following the 1998 Russian financial crisis. Rosbank and over 40 other Russian financial institutions also provided agent bank processing referrals to UCS under the agreement.

Online Payment Service Processors (PSPs) 

Online payment service processors (PSPs) are specialised technical processors for all kind of secure online payments and mobile payments. Some of them also offer virtual PSP platform services (VPSP) for bank acquirers who want to take advantage of a kind of ‘internet network processor’.

Online shops of merchants are directly connected by an API interface or a hosted payment page either to the internet payment gateway of a bank acquirer, or they are connected to multi-acquirers through a PSP.

PSPs usually partner with more than one card acquirer and payment initiation service providers. Core services offered by PSPs may include payment gateways to card acquirers and other online payment service providers, online payment processing, risk management services, and collection services for merchants.

Security technologies applied to ensure secure online card payments include EMV tokenisation and strong 3D-Secure (MCSC, VbV, SafeKey) combined with one-time tokens. For card-less payment services, the security technologies applied include userID/password combined with one-time tokens and online banking access with one-time TAN.

The leading internet payment service processors and payment aggregators in Russia include YooKassa, WebMoney, Qiwi, RBK Money, Money@Mail.ru (Qiwi), Assist, moneta.ru and ChronoPay. Other major PSPs include the payment aggregators PayOnline.ru, PayTure, PayU, PayAnyWay, Platron, Robokassa (Ocean Bank), UniTeller, PayAnyWay, Payeer, PayMaster, UnitPay, Interkassa, and Worldline. Also, leading international PSPs are active in the country.

PayOnline – In May 2015, Net Element (US), a global technology-driven group specialising in mobile payments and value-added transactional services acquired PayOnline, a leader in online transaction processing services and payment technology for up to $8.4 million. PayOnline processes online payments for over 10 million active consumers and thousands of merchants in the Russian Federation, Europe and Asia. In July 2016, PayOnline claimed to be one of the first independent payment service providers to support the acceptance of ‘MIR’ cards. In April 2017, PayOnline launched Apple Pay support in Russia. PayOnline offices are located in Russia and in the Republic of Cyprus.

Acquiring and Acceptance

In Europe, most acquirers offer multi-channel card acceptance and value-added merchant services at POS terminals, mobile MPOS terminals and online shops. The leading acquirers usually offer their services cross-border.

In addition, innovative acquirers also offer the acceptance of card-less payment services based on partner agreements with the issuer of those payment services (e.g. account-based payments, wallets, prepaid products).

Most acquirers either operate their own acquirer systems and ATM/POS/MPOS network service hubs, or they use the processing services of external processors. In order to service online merchants in Europe, they might operate their own PSP processing platforms, or they co-operate with one or more specialised online payment service processors (PSPs).

From 2012, Eurasian acquirers compete in their home markets, cross-border in the CIS region, cross-channel at POS terminals and servicing online merchants. From 2016, innovative acquirers started to offer omni-channel and multi-payment acceptance.

By mid-2024, omni-channel acceptance includes the ability to service all channels (i.e. POS/MPOS terminals, mobile in-store, online shops, in-app), and to accept multiple payment means in all of these channels. Multi-payment services demanded by merchants include cards, online bank payments, online wallets, digital wallets, and prepaid products.

Outlook – By mid-2024, Russian acquirers face the following notable challenges:

• Rollout of contactless POS/MPOS terminals, Interchange++
• Complete acquirer service portfolio beyond cards, i.e. acceptance of card-less payment services
• Omni-channel payment acceptance: POS/MPOS, online, mobile in-app, mobile in-store
• Cross-border competition, omni-channel competition, finding PSP partners and PISP partners
• New security standards: e.g. 3D-Secure 2.3, tokenisation security, Strong Customer Authentication

International cards have been acquired in Russia since the 1980s, through the old Intourist travel agency monopoly. While card acceptance originally began in the T&E sector in the Soviet era, today’s profile by type of outlet is much more broadly based, with general merchandise shops representing 67% of total acceptance.

In 2023, 214 of the 324 Russian banks were active in the acquiring business. They all acquire MIR cards and the Mastercard and VISA card brands. Local card brands are acquired by the participating acquirers, respectively.

In April 2007, American Express and Russian Standard Bank (RSB), the leading Russian credit card issuer, announced a long-term agreement for RSB to become the exclusive legal acquirer of Amex merchants in Russia from June 2007. The agreement required other banks and processing companies to sign agency agreements with RSB to continue servicing Amex cards, leading to a dispute with UCS.

Russian Standard Bank is also the acquirer of Diners Club cards. UCS is one of many JCB acquirers and is the UnionPay acquirer. In May 2017, JCB International signed an agreement with Sberbank to start accepting JCB cards on the Sberbank nationwide POS terminal network. From 2018, Credit Europe Bank and Russian Agriculture Bank accept JCB cards.

In July 2018, VTB Bank began accepting Huawei Pay at its POS terminals. In February 2018, Ingenico and Alfa Bank partnered to enable local card processing in Russia for international merchants.

In November 2018, Ingenico Group (F) and Sberbank joined forces to ensure the acceptance of MIR cards on international websites, expanding the geography of online purchases.

Clearing for card transactions had been performed through the payment schemes with settlement banks Citibank Russia for VISA and Sberbank for Mastercard. However, as of 1 April 2015, all payment card transactions, including those made with a VISA or Mastercard, are processed via the NSPK Transaction Settlement and Clearing Centre (NSPK TSCC).

The leading acquirers in Russia are Sberbank, VTB Bank, Gazprombank and Russian Standard Bank. Other major acquirers include United Card Service (UCS), PromSvyazBank, Alfa Bank, B&N Bank, Bank Zenit, RuCard and Bank Trust.

In 2011, UCS bought the acquiring business of Alfa Bank (see above). Processing centre RuCard acquires on behalf of many smaller banks. Table 9 illustrates the card brands accepted by Russian acquirers as at mid-2023.

9 - ATMs in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cash-dispensing ATMs	131,908	124,687	120,745	114,343	115,059	0.63%	-2.31%
Ø Number of TXs per ATM per month	1,924.2	1,663.1	1,612.6	1,559.0	1,446.5	-7.21%	-6.59%
Number of ATM cash withdrawals (m)	3,045.9	2,488.4	2,336.6	2,139.1	1,997.2	-6.63%	-8.75%
- on domestic cards (m)	3,033.5	2,480.7	2,329.6	2,139.1	1,997.2	-6.63%	-8.67%
- on foreign cards (m)	12.4	7.6	7.0	0.0	0.0	NA	NA
Value of ATM cash withdrawals (RUR bn)	27,500.2	27,054.7	29,672.9	31,110.6	35,080.2	12.76%	5.68%
- on domestic cards (RUR bn)	27,368.5	26,958.6	29,579.0	31,110.6	35,080.2	12.76%	5.79%
- on foreign cards (RUR bn)	131.7	96.2	93.9	0.0	0.0	NA	NA
ATV per ATM withdrawal (RUR)	9,028.65	10,872.39	12,699.43	14,543.57	17,564.41	20.77%	15.82%
# ATM terminals per 1m capita - Russia	898.8	851.3	824.4	780.7	787.3	0.84%	-2.22%
# ATM terminals per 1m capita - EA10 total	728.9	713.7	698.7	679.4	706.3	3.96%	-0.17%
Source: BIS, CBR.

10 - POS Terminals in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
EFTPOS terminals	2,913,026	3,598,729	3,546,869	3,809,513	4,051,733	6.4%	9.4%
Ø Number of TXs per POS per month	780.2	723.2	1141.5	1189.1	1262.2	6.1%	13.4%
Number of POS payments (m)	27,273.7	31,232.1	48,583.9	54,360.9	61,368.4	12.9%	24.1%
- on domestic cards (m)	27,151.6	38,812.3	48,446.4	54,360.9	61,368.4	12.9%	24.2%
- on foreign cards (m)	122.1	133.5	137.6	0.0	0.0	NA	NA
Value of POS payments (RUR bn)	18,488.3	20,727.4	43,773.5	49,610.9	56,377.5	13.6%	30.1%
- on domestic cards (RUR bn)	18,163.9	32,429.6	43,483.2	49,610.9	56,377.5	13.6%	30.7%
- on foreign cards (RUR bn)	324.3	276.4	290.3	0.0	0.0	NA	NA
ATV per POS payment (RUR)	677.88	663.66	900.99	912.62	918.67	0.7%	4.9%
# POS terminals per 1m capita - Russia	19,848.2	24,571.4	24,217.3	26,010.6	27,723.0	6.6%	9.5%
# POS terminals per 1m capita - EA10 total	15,041.9	17,950.0	19,042.0	21,172.0	23,259.9	9.9%	12.5%
Source: CBR, BIS.

Sberbank (Sber) – From 1992 to 2007, UCS was the largest Russian third-party acquirer before Sberbank overtook UCS in acquiring. The two biggest acquirers, Sberbank and UCS, account for about 80% of the market. Sberbank has targeted merchant acquiring for expansion in recent years. Clients include major airlines and retailers, and the value of accepted payments processed in 2022 was reported to be $425.1 billion. Sberbank claims an extensive network of outlets accepting cards, a broad product range, and viable tariffs as competitive advantages. The number of POS terminals in Sberbank’s acquiring network reached 2,367,000 at end-2022. Sberbank reported RUB 73 trillion in total volume of payments, transfers, and acquiring in 2022 from a total of RUB 42.3 trillion in 2021.

VTB Bank – In 2022, VTB was the 25th largest acquirer in Europe, acquiring payments worth a total of $35.9 billion. VTB served 200,482 merchants and 408,319 POS terminals in its network in 2022.

During 2019, VTB launched the Cash2Card service, enabling cardholders with cards from any Russian bank to top them up with cash at VTB ATMs; the service includes agreements with six banks to service their customers through VTB’s ATM network free of charge (with commission paid by the issuer). VTB also launched transfers to cards using the UnionPay payment system from Russian VISA/Mastercard/MIR cards and internet acquiring for UnionPay and American Express cards.

VTB launched a pilot product in late 2020 called VTB-Kassa, a business solution that combines the functionality of a cash register (including online data transfer to the Federal Tax Service) and a POS terminal for accepting bank cards. The device also enables customer payments through the Faster Payment System.

Alfa Bank – Although Alfa Bank sold its physical acquiring business to UCS in 2011, it continues to develop online acquiring and claims 40% share of this market, providing services to companies of all sizes. Alfa notes that the attraction of online acquiring is that the bank itself handles processing and payments on credit card transactions, without intermediaries. It won Aeroflot, Russia’s largest airline, as a customer in 2012. In February 2018, Alfa Bank partnered with Ingenico Group (F) to enable international merchants to process card payments in Russia locally rather than as a cross-border payment.

Two of the big state-owned banks have targeted the acquiring market. GazPromBank (GPB), with its corporate link to Gazprom petrol stations, has built up turnover over recent years to $9.3 billion in 2021, while Russian Agricultural Bank (RAB) launched acquiring services in 2010. In 2019, RAB stated that it had expanded into mobile payment acquiring and reaching new clients in the delivery services, taxis, travel agencies and other small business sectors. RAB also introduced a cash withdrawal feature at merchants’ POS along a Mastercard and VISA purchase. To develop its Internet acquiring, RAB gained JCB certification, opening the way for JCB cards acceptance at e-commerce outlets. RAB was the first Russian issuer to introduce P2P transfers with the use of JCB payment system via RAB’s remote channels including ATMs, retail remote service channels and at RAB’s Internet site. RAB also initiated procedures to complete certification by UnionPay and American Express payment systems, which will open the way for more cards acceptance at e-commerce outlets.

In 2020, the CBR supported business and households by taking measures aimed at reducing the impact of the COVID-19 pandemic. In particular, the maximum acquiring fee of banks was temporarily established at the level of 1% for medical and socially important goods and services, and for crediting pension and social payments to any payment cards.

ATM Terminal Infrastructure

In 2023, the Russian banks operated around 40 ATM networks which are interconnected through the NPCS. However, the ‘off-us’ transactions are cleared through the National Clearing Centre (NCC) at the CBR.

Subsequent updates show rapid growth, with the number of ATMs almost doubling over the five-year period to end-2014. The number of ATMs per million inhabitants reached 787.3 compared with an EU average of 770.7 per million inhabitants in 2023.

Since January 2016, the entire Russian ATM network accepts MIR cards. Other accepted card brands at Russian ATMs are debit cards (Mastercard, Debit Mastercard, Maestro, VISA, VISA Debit, and Electron) and credit cards (Mastercard, VISA, American Express, Diners, Discover, JCB, and UnionPay). Accepted card brands at ATMs also include Cirrus, Plus, and Pulse. The EMV migration of ATMs achieved 80% in 2013 and was completed in 2016. According to the CBR, as of 2023, almost 92.2% of ATMs supported contactless technology.

The sustained impact of the COVID-19 pandemic can be seen in the continuous drop in cash withdrawals. According to the CBR, in 2023, there were 115,059 ATMs (+0.63% from 2022) and 1.99 billion withdrawals on cards (-6.63%) with a total value of RUR 35.08 trillion (+12.76% from 2022). The ATV per cash withdrawal amounted to RUR 17,564.41 or $207.48 equivalent. In 2023, there were 1,446.5 cash withdrawals per ATM per month (-7.21% from 2022). By end-2023, there were over 100,000 contactless ATMs – these were first introduced in mid-2018, so there is as yet no formally updated figure.

11 - Internet Use in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Internet use (individuals)	83%	85%	86%	87%	87%	0.00%	1.47%
Online buyers (individuals)	79%	81%	82%	83%	83%	0.00%	3.47%
Mobile subscribers per 100 inhabitants	164.4%	163.6%	169.0%	168.7%	168.7%	0.00%	1.39%
Number of remote access accounts (m)	250.76	278.75	314.07	350.02	376.74	7.64%	10.09%
- of which with internet access	96.4%	96.2%	96.1%	96.1%	96.1%	0.08%	0.62%
- of which with access by mobile devices	73.0%	72.5%	73.4%	74.7%	72.9%	-2.30%	-0.95%
B2C e-commerce revenue (€bn)	23.40	32.64	47.04	80.44	98.26	22.15%	41.21%
Annual B2C eCommerce growth rate/year	33.7%	39.5%	44.1%	71.0%	22.2%	-	-
Total B2C e-commerce value per capita	€159.44	€222.86	€321.18	€549.23	€672.32	22.41%	41.34%
Total B2C e-commerce value per online buyer	€201.82	€275.14	€391.68	€661.72	€810.02	22.41%	36.61%
Note: remote access accounts, opened by individuals with credit institutions, are used for online payments and other cashless payments.
Source: CBR, Eurostat, ITU, PCM research.

Sberbank reported 45,200 ATMs in its network as of 2022, and all the ATMs feature contactless technology and offer a personalized home screen. Sber kept the possibility for its customers to use ATMs without a card and offered to withdraw cash by a QR code without a card as an alternative to SberPay mobile wallets. According to Sberbank, most of its ATMs can be used to top up mobile phone accounts and make payments for certain other services.

Russian Standard Bank (RSB) had an estimated 6,200 ATMs and instant payment terminals by end-2023, including the arrangements with partner banks regarding the use of their ATMs.

Few other banks supply up-to-date figures for their networks. Several banks have linked their ATM networks with those of rivals to achieve greater distribution, including the ATLAS ATM network.

POS Terminal Infrastructure

In 2023, the Russian bank operated around 40 POS networks which are interconnected through the NPCS.

A feature of the Russian market in recent years has been the expansion of networks away from Moscow and St Petersburg, where acceptance was originally concentrated. By system, the new MIR network and the international networks dominate, with VISA and Mastercard cards accepted at the great majority of POS terminals.

Most of the POS terminals accept MIR cards. Other accepted card brands at Russian POS terminals are debit cards (Mastercard, Debit Mastercard, Maestro, VISA, VISA Debit, and Electron), and credit cards (Mastercard, VISA, American Express, Diners, Discover, JCB, and UnionPay). UnionPay cards are accepted at selected merchant outlets frequented by tourists. The EMV migration of POS terminals was completed in 2017.

The CBR reported 4,051,733 POS terminals as at end-2023 (5-year CAGR: 9.4%). Based on the end-2023 figure, there were 27.72 POS terminals per thousand inhabitants in Russia, compared with the EU average of 32.67 per thousand EU inhabitants in 2023. Despite recent growth, the POS terminal base in Russia lags behind the EU in terms of penetration, in contrast to the ATM base.

In 2023, there were 61.36 billion POS payments on cards and e-money cards (+12.9%) with a total value of RUR 56.37 trillion (+13.6% from 2022). The ATV per POS payment amounted to RUR 918.67 or $10.85 equivalent. In 2023, there were 1,262.2 payments per POS terminal per month (+6.1% from 2022).

12 - Bank Cards Issued in Russia
(000s)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a cash function	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
Card with a payment function	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
- Cards with a debit function	248,648.0	266,479.4	294,267.0	349,207.1	394,729.8	13.04%	10.69%
- Cards with a credit function	37,183.9	39,143.4	40,436.7	47,428.6	54,552.3	15.02%	9.23%
Cards with an e-money function	257,117.4	356,262.3	364,040.9	284,507.3	296,781.8	4.31%	9.71%
Total cards	542,949.3	661,885.2	698,744.7	681,143.0	746,063.9	9.53%	10.19%
Total cards per capita - Russia	3.70	4.52	4.77	4.65	5.10	9.76%	10.29%
Payment cards per capita - Russia	1.95	2.09	2.29	2.71	3.07	13.51%	10.61%
Payment cards per capita - EA10 total	1.50	1.65	1.83	2.09	2.42	15.79%	11.57%
Note: e-money card numbers have been restated and include all kinds of virtual e-money (virtual cards, e-wallets etc.)
Note: debit card figures include delayed debit cards.
Source: CBR, BIS.

Among individual banks, Sberbank reported 2,250,000 POS terminals in Russia and abroad at end-2023, while VTB reported over 300,000 POS terminals at end-2023.

Contactless POS Terminals – The rollout of contactless POS terminals has gained momentum. In June 2012, around 2,000 offices of Russian Post were equipped with contactless POS terminals. In March 2015, Mastercard, in partnership with the St. Petersburg government, the St. Petersburg Metro, and Bank Saint Petersburg, launched the implementation of contactless PayPass technology in a Russian subway. According to the CBR, in 2021, contactless payments increased by 1.3 times in terms of the number and 1.5 times in terms of value, up to 35.4 billion transactions for the amount of RUB 33.2 trillion. More than 26.6 billion transactions worth RUB 24.9 trillion were conducted with contactless cards, while contactless cards comprised almost 80% of all cards in circulation in 2021. In 2022, consumer demand for contactless technology remained stable. More than 74% of operations for payment for goods and services were carried out with using contactless technologies and the share of such operations in value exceeded 55%. By end-2023, 92.2% of the total POS terminal estate supported contactless technology. Consumers broadly used these technologies to pay for goods and services and conducted 48.2 billion such transactions worth RUR 52.9 trillion during 2023. The share of contactless transactions in the total number and value of payments for goods and services rose to 76.2% and 55.6%, respectively. This was in part due to the use of the MIR Pay application enabling a customer to pay for purchases with a smartphone his/her MIR card is linked to.

From June 2016, contactless POS terminals in Russia can accept UnionPay’s mobile QuickPass, the NFC contactless payment on UnionPay cards, smartphones, and wearable devices. In 2023, there were more than 400,000 POS terminals that can accept UnionPay Quickpass payments, including Huawei Pay.

MPOS Terminals – Small and mobile merchants have started to use their smartphones and tablet PCs as mini-POS+ECR device with added chip reader dongle. Also, merchants can initiate MOTO-like card payments on smartphones and tablets by downloading a payment app.

In December 2012, Square clones like Zettle, SumUp and others launched their services in Europe and are expected to support Russian merchants. Sum-Up entered the Russian market in 2013.

Local MPOS terminal service providers in Russia include iPay, LifePay, Pay-me, RBK Money and SellbyCell.

In June 2017, Sberbank started the deployment of Spire and Lanter MPOS terminals across four major Russian cities. In August 2017, Spire Payments, Payneteasy and Cassby started to rollout MPOS in Russia.

In 2019 Russian Standard Bank rolled mCassa, a mobile POS system based on Android which provides payment acceptance in merchant outlets. In October 2019 the bank launched mobile SoftPOS, which turns smartphones into card-accepting devices.

SmartPOS Terminals – In 2018, POS terminal vendors launched innovative new types of POS terminals. Named SmartPOS terminals, they combine the electronic cash register functionality (ECR) used by merchants in outlets with a contactless POS payment terminal and merchant services in the cloud. For the very first time, the so far separated ECR devices and POS terminals are integrated in just one checkout solution device. From late 2018, SmartPOS terminal vendors like Castles, Clover, Ingenico, Jusp, Handpoint, PAX, Poynt, Spire Payments, Verifone, Worldline, and others have launched their SmartPOS devices and services in Europe. It is believed that Russian SME merchants will embrace SmartPOS terminals.

Remote Internet Payments – Cards & More

Russia is among the fastest-growing e-commerce market in the world. However, it remains smaller than most online markets in western Europe, given that was worth €80.44 billion in 2022, as opposed to €291 billion in the UK and €147 billion in France in 2022.

Internet Use – According to official statistics, the level of Internet penetration in Russia is 88% (2022) and an estimated 85% of the Russian internet users were online shoppers. Russia’s domestic e-commerce market grew by more than 50% in 2020, reaching RUB 4.1 trillion, and more than 1.7 trillion online orders were made, more than doubling (+104%) year-on-year. Online sales accounted for around 12% of Russia’s total retail market.

According to the CBR, remote internet transactions rose 13.1% to 78.1 billion in 2022, for a total value of RUB 1,463.0 trillion (+39.1% from 2021). Almost 40% of Russian citizens made electronic payments using the internet or mobile devices. For businesses, the share of payments via the Internet amounted to 62%.

Almost 40% of Russian consumers reported having made online purchases and/or paid bills online in 2021. Russia’s B2C m-commerce also grew by 30% in 2021, due to Russia’s development of mobile and cross-border e-commerce.

B2C e-commerce – In 2022, B2C e-commerce accounted for €80.44 billion, up by 71.0% from 2021. The B2C e-commerce value per capita amounted to €549.23, while it was €661.72 per online buyer.

13 - Active Bank Cards in Russia
(000s)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards issued	285,832	305,623	334,704	396,636	449,282	13.27%	10.51%
Cards in use	196,920	209,459	231,461	252,695	270,083	6.88%	8.55%
Active cards in %	68.9%	68.5%	69.2%	63.7%	60.1%	-5.64%	-1.78%
Cash withdrawals value (RURm)	27,241.78	26,791.68	28,010.72	29,596.54	33,309.64	12.55%	4.60%
Card payments value (RURm)	26,253.04	31,193.37	41,367.07	46,780.76	54,389.29	16.26%	20.99%
Other transactions (RURm)	35,612.57	44,807.48	59,756.04	73,306.89	79,264.02	8.13%	23.69%
Total transactions value (RURm)	89,107.38	102,792.53	129,133.83	149,684.20	166,962.94	11.54%	17.37%
Cash withdrawals value in %	30.6%	26.1%	21.7%	19.8%	20.0%	0.90%	-10.88%
Active payment cards per capita	1.34	1.43	1.58	1.73	1.85	7.11%	8.65%
Note: active cards in use are those used in transactions at least once during a quarter; figures from 2013 do not include e-money cards.
Note: figures are for active bank-issued consumer cards and transactions within Russia and abroad.
Note: other transactions include money transfers on bank cards to other bank accounts, e.g. charitable contributions, money transfers at ATMs, etc.
Source: Central Bank of Russia (CBR).

Cards on the Internet (CNP) – All cards with international brands are accepted in Russian online shops after the merchant has signed an acceptance contract. Russian banks issue prepaid cards and virtual cards for internet use.

Leading online shops in Russia have started to offer remote payments on cards based on security standards like SSL with CVC2/CVV2 code and 3D-Secure (Mastercard SecureCode, Verified by VISA). Further, a few web-based MOTO-like services are offered to Russian merchants by their acquirers.

The e-Payment Mix – While internet and smartphone penetration in Russia is higher than average for Eastern Europe, Russians pay cash-on-delivery for online purchases more than half the time. However, non-cash methods are growing in popularity and at significantly high growth rates. Cards are mistrusted but used more in the big cities.

According to merchant statistics, the most popular e-commerce payment methods as of 2022 were debit cards (30%), and e-wallets (25%), followed by credit cards, bank transfers, cash on delivery, charge and deferred debit card, and prepaid cards. The three most popular methods of online payment in Russia are Sberbank Online, bank cards and YooMoney. Contactless payment systems, such as Apple Pay and Samsung Pay, are growing in usage, being used mostly for online shopping, food delivery, housing services, cellular networks, and money transfers.

Sberbank Online is the most popular electronic payment service in Russia. Four out of five Russian users made at least one payment in it during 2023. In addition to YooMoney and PayPal mentioned above, services like Qiwi and WebMoney are also widely used. Online banking services are also traditionally popular in Russia. Online services from Sberbank, VTB, Alfa-Bank, and Tinkoff Bank are in the highest demand.

Online Wallets and Payment Aggregators in Russia 

The four major online wallets and payment aggregators in Russia are WebMoney, YooMoney, Qiwi, and RBK Money. Reliable comparative figures are not available, but YooMoney appears to be the biggest. As well as in electronic commerce, most of them are involved in money remittances in Russia and beyond.

Russian banks like Russian Standard Bank work closely with Qiwi, WebMoney and YooMoney. In October 2013, PayPal entered the Russian market. In January 2016, Alipay entered Russia co-operating with VTB Bank.

Among e-wallets, YooMoney is the most widely offered online payment service in online shops followed by WebMoney, Qiwi, PayPal, and Money@Mail.ru.

YooMoney (formerly Yandex.Money) is focused on payments for services and goods on the internet, and funds can be added to a YooMoney wallet using terminals, money transfer systems, debit, credit and prepaid cards in all regions of Russia. Payments via YooMoney are instant and no commission is paid.

In December 2012, Sberbank acquired 75% of Yandex.Money, one of Russia’s biggest electronic payment systems, from Yandex, the country’s biggest search engine, which retained 25% plus one share.

Yandex.Money allowed online stores to accept payments by bank card, from bank accounts via various online banking services, from Yandex.Money and WebMoney e-wallets, and in cash via 250,000 deposit locations including mobile retail outlets, payment kiosks and Sberbank ATMs. In 2019, more than 120,000 online stores used the Yandex payment solution. Yandex.Money partnered cross-borders with the European PSPs SafePay (UK), Adyen (NL), WorldPay (UK), and Ingenico ePayments (F), which absorbed GlobalCollect from 2018, Yandex.Checkout offered payment services for merchants including cards from American Express, JCB, and Diners Club. Following the split between Sberbank and Yandex in mid-2020, Sberbank retained Yandex.Money and renamed it YooMoney. YooMoney claimed in 2020 to be the second most popular online payment service in Russia with 60 million digital wallet users.

Yandex.Gas App – In October 2017, Yandex.Money released the Yandex.Gas app to allow drivers to pay for fuel remotely. The app was available in LUKOIL gas stations in Moscow and was supported at all 2,250 gas stations of the LUKOIL network in Russia. Further on, the service will be available at other gas stations.

The driver selects the pump number, the amount of fuel or the sum they would like to fill up for. Payment can be made with Yandex.Money wallet or on Mastercard cards. Also, LUKOIL loyalty cards can be added to the app.

In 2018, LUKOIL planned to enrich the list of available payment methods with other options, such as bank cards of other payment systems and Apple Pay. In addition, there will be a special Yandex.Gas API that will allow any gas station network to connect to the application on their own, with no need to update or replace software or cash registers in each separate gas station. The fuel pumps at the stations will be gradually equipped with QR-codes, so drivers won’t have to specify stations and pumps numbers manually and will only need to scan a QR-code.

WebMoney – Payment aggregator WebMoney Transfer reported transactions valued at $18.4 billion in 2015, up from $17.0 billion in 2012. There were 183 million transactions in 2017, compared with 160 million in 2012. WebMoney publishes the number of annual registrations rather than number of accounts and reported 3.91 million in 2017, lifting the cumulative total to about 37.74 million since its launch in 2001. In 2021, the system was used by 46.2 million users worldwide, with around 150,000 active users per month. WebMoney claims to add a further 15,000 users weekly and is accepted as a payment service by more than 100,000 online stores globally.

RBK Money (previously RUpay) serves more than 8 million e-wallet users and cooperates with 30,000 online businesses. It operates in 40,000 post offices across Russia and is affiliated with the country’s main banks, claiming 250,000 cash acceptance point nationwide. In May 2012, RBK Money announced cooperation with UKTI, the UK’s official trade services body, to help British companies trade in Russia. The company is active in 60 countries around the world and has 87 partnership agreements including the aforementioned with UKTI, and 20 banking partnerships. It claims a 97% success rate in payment conversions and to be 99.99% available, 365 days a year.

Qiwi was launched by OSMP Group, the largest Russian cash terminal network, in 2007 and obtained a Nasdaq listing in May 2013. Qiwi operates both online and offline, the latter through the network of 111,000 Qiwi cash kiosks and 23,000 terminals managed by OSMP and partners, around 50% of the market. Such kiosks are used to pay utility bills, taxes, online retailers, person-to-person payments, send international remittances and access a range of other financial services.

Qiwi also operates the Qiwi wallet co-badged VISA for international use. Qiwi operates personal payments, enabling money transfers to VISA cards issued by any bank in Russia, Georgia, Kazakhstan, Ukraine, Uzbekistan, Moldova, Azerbaijan and Tajikistan.

By end-2022, Qiwi claimed 13.8 million active e-wallet accounts, RUB 1,875 billion in payment service value, 74,093 active and kiosks and terminals.

In November 2014, Qiwi acquired Money.Mail.Ru, the instant payment venture, from Mail.Ru Group. After the completion of the transition period all Money.Mail.Ru transactions were settled by Qiwi. Money.Mail.Ru is a payment service that allows users to make instant payments for goods and services via web interface or apps at any convenient time. Mail.Ru Group’s projects support a variety of online payment options including Money.Mail.Ru, banking cards, payment terminals, and mobile phone payments. After the acquisition of Money.Mail.Ru by Qiwi, a wide range of payment methods continued.

In June 2015, VimpelCom also launched a mobile payment wallet in partnership with VISA Qiwi Wallet, but does not consider it to be redundant in comparison with ‘Ruru.’

In March 2016, mobile network operator MegaFon closed its MegaFon Money P2P mobile payment service in favor of supporting Qiwi Wallet with its integrated HCE support. To put things into perspective, the ‘MegaFon Money’ service was launched in 2012, when MegaFon’s competitors Beeline (VimpelCom) and MTS were developing their own payment platforms Ruru and Legkiy Platezh.

In June 2018, Qiwi and Revolut, the UK digital challenger bank, partnered to launch Revolut services in Russia that will run on the payment infrastructure of QIWI Bank. As part of the agreement, QIWI Group will grant Revolut access to its banking infrastructure via open APIs. QIWI APIs provide access to the infrastructure of QIWI Bank, including its banking licenses and technologies for customer identification, payment processing, and card issuance. In Russia, Revolut will only provide financial services to individuals. By 2019, Qiwi had enabled both Apple Pay and Google Pay via its QIWI cards, as well as Windows Pay.

Alibaba and AliExpress in Russia – In September 2018, Alibaba signed a strategic partnership with Russian companies to form a new e-commerce platform and utilise Russia`s MIR payments system. The partnership aimed to both integrate Russia`s key consumer internet and e-commerce platforms and launch a social commerce joint venture in Russia.

AliExpress Russia was created in October 2019 as a joint venture of Alibaba Group, Russian telecom company MegaFon, Internet giant Mail.ru Group and the Russian Direct Investment Fund (RDIF). As of 2021, the platform’s number of active customers grew to 35 million people with more than 20,000 pick-up points across Russia. In May 2022 it was reported that AliExpress Russia was cutting jobs and scaling back operations due to the Ukraine conflict.

Remote Payments on the Mobile Internet – Since 2013, online buyers have started to use their smartphones for shopping on the mobile internet. Mobile shops can be accessed by mobile internet, by mobile app, or by scanning a 2D QR-code displayed, for example, in a newspaper or at a bus station. Thus, remote mobile payments are executed by either using the e-payment page of the mobile shop or by using payment apps of a PSP or an acquirer.

Also, Russian merchants can download a payment app from their acquirer in order to initiate MOTO payments with cards and/or online direct debits. Leading Russian merchants are believed to consider their own apps including loyalty functions (e.g. e-vouchers, discounts, outlet finder, QR-code scanning) in the future.

Mobile Payments – Overview 

In 2022, 168% of Russians have subscribed to a mobile phone. Around 70% of the Russians owned a smartphone and 44% owned a tablet. In 2023, 96.9% of Russians used some form of mobile or smartphone banking service or app.

In Russia, SMS payment services continued to be used for online payments and online bank payment services.

All major Russian mobile network operators (MNOs) offer payment platforms which allow for carrier billing, SMS payments, mobile apps and web interfaces. Users are not limited to the sums that remain on their mobile accounts to settle purchases. In certain cases, they may also use money from their bank account, with a bank card, or an e-currency account.

Technically, the payment platforms of the MNOs work via virtual payment cards tied to mobile accounts. They are used to settle mobile phone, ISP, TV or utility bills, as well as to pay back loans, replenish e-currency accounts or even pay fines. For example, RURU is the payment platform created by VimpelCom in 2011.

Merchants wishing to integrate mobile payments do not engage directly with mobile operators, but with the banks or payment service providers (PSPs) representing them. One important payment provider, MobiDengi, serves the “Big Three” MNOs – Megafon, MTS and VimpelCom – as well as Tele2, Scartel and some regional operators, in addition to offering its own payment platform.

InPlat, created more recently, has also gained a notable position in the market. Among other payment aggregating PSPs are inPlat, Master Bank, Qiwi, Robokassa (Ocean Bank), and CyberPlat.

Since 2010, the next generation of mobile services and payments has started, pushed by the online buyers’ high affinity to smartphones and tablets and, also, by new disruptive technologies (1D-barcodes, QR-code, Bluetooth BLE and NFC).

Mobile initiatives in Russia, if any, are trialling new technologies either as initiating form factors to bridge to online shops on the internet (1D-barcodes, QR-code, NFC) or to enable contactless access to the retail POS outlet (1D-barcodes, QR-code, BLE, Bluetooth Low Energy, NFC Stickers, Mobile NFC Phones) e.g.:

• To enable access to online shops for any type of mobile devices (e.g. tablets, iPhones, Androids)
• To enable mobile services and payments initiated by consumers’ tablets or smartphones at ATMs, at vending machines, at smart posters and at POS terminals in retail outlets
• To enable small merchants’ tablets and smartphones by adding MPOS terminal devices for payment services.

In 2023, there were several ways to make mobile payments in Russia, ranging from mobile carrier billing and SMS checkout via the bank payments network to integrated in-app payment, mobile NFC payments, and QR-code initiated payment.

The Russian m-Payment Mix – There are no official m-payment mix statistics, but PSP information indicates that the domestic m-payment mix is similar to the e-payment mix (see Remote Payments on the Internet section).

Mobile Payment Initiatives 

In 2024, the various Russian mobile payment initiatives can be grouped into

• Non-bank players like FinTechs, payment initiation service provider (PISPs), and account information service providers (AISPs) launch digital payment services beyond cards
• Innovative banks which launch mobile banking apps allowing for card-less in-app payments and payments on the internet
• Leading banks which pilot mobile HCE NFC payments with the card credentials stored-on-file in the cloud (HCE)
• Banks partnering with mobile network operators in order to offer mobile SIM SE NFC payments on cards with the card credentials stored in a secure element on SIM card of the mobile device
• Innovative retailers which offer their own apps with loyalty and payment functions to their consumers

Review – In the period from 2008 to 2016, various mobile SMS payments and contactless SIM SE NFC mobile initiatives were trialled. Although the technology piloted has been experienced as market proven, many of the mobile payment initiatives were phased-out due to slow user adoption. From 2016, mobile payment initiatives in Russia have entered a consolidation phase ending up with mobile banking apps and mobile HCE NFC payments on cards. For details and historic background regarding the phased-out mobile payment initiatives refer to the Appendix.

Mobile HCE NFC Payments – In June 2013, Tinkoff Bank launched an NFC mobile wallet service that enabled virtual Mastercard PayPass cards to be stored on embedded secure elements in Android NFC phones without using the SIM card of the phone.  Tinkoff Bank is going to focus on HCE NFC payments.

In May 2014, Sberbank began piloting HCE NFC payments in Moscow using embedded secure elements. It followed the trial with a service using host card emulation (HCE). The bank tested its HCE service ahead of a wider roll-out and planned to use a recently launched cloud-based digital issuance solution.

In June 2014, Russian Standard Bank enabled Mastercard PayPass contactless HCE NFC payments on Samsung smartphones.

In June 2015, Russian payment services provider Qiwi integrated VISA payWave technology into its Qiwi Wallet app to enable HCE NFC payments at any contactless POS terminal. The Qiwi wallet was co-badged VISA and used cloud-based HCE technology to store the card credentials.

In September 2016, B&N bank launched a PIN-less mobile HCE NFC payment service using the B&N Bank mobile app. Customers could pay from their Mastercard account with contactless mobile payments via mobile with no additional passwords, no need to enter a PIN-code or additional app password.

In September 2016, mobile network operator MTS launched NFC mobile payments using the new MTS Money service, which enables users to upload virtual banking cards, public transport tickets and discount coupons. Customers of MTS can now make NFC-based mobile payments.

Mobile QR-Code initiated payments – Like Yandex.Money with its Yandex.Checkout app, Russian mobile payments startup PayQR offered QR-code based payment services on cards, since February 2016.

Bots-based Messenger Payments – In October 2017, Sberbank and Telegram, a messenger API, developed a payment solution for partners using Telegram bots. The solution allows Mastercard, VISA and MIR card payments acceptance. The system is also designed to allow, for the first time, both Apple Pay and Android Pay as payment methods using Telegram bots.

Users can set up their own bot through BotFather, created by Telegram’s payments API. Existing partners can then select Sberbank as their payment provider and specify the internet acquiring contract ID. There will also be an option available for non-partners to test payment receipt by entering “test” in the login field.

Central Bank Digital Currencies (CDBC) – The Digital Cash Challenge 

Central bank digital currency (CBDC), also called digital fiat currency or digital base money, is a digital currency issued by a national central bank (NCB), rather than by a commercial bank. It is also a liability of the NCB and denominated in the sovereign currency, as is the case with physical banknotes and coins.

All CBDCs are under the authority of the respective national central bank, and they are part of the domestic cash payment ecosystem. Rather than a new currency, CBDC is a form of central bank electronic money that could be used by households and businesses to make payments. In addition, most CBDC implementations will likely not use or need any sort of distributed ledger such as a blockchain.

Unlike “retail CBDC,” which is generally designed as a central bank liability universally accessible to individuals and businesses within a jurisdiction’s financial system, “wholesale CBDC” refers to a digitized central bank liability designed for sizable (generally interbank) transactions, and for which access is limited to certain financial institutions.

National Central Banks (NCBs) have been providing trusted money to the public for hundreds of years as part of their public policy objectives. Trusted money is a public good. It offers a common unit of account, store of value and medium of exchange for the sale of goods and services and settlement of financial transactions. Providing cash for public use is an important tool for central banks. Yet the world is changing.

Even before COVID-19, cash use for payments was declining fast and convenient digital payments have grown enormously in volume and diversity. To evolve and pursue their public policy objectives in a digital world, central banks are actively researching the pros and cons of offering a digital currency to the public, a “general purpose” CBDC.

Central banks’ interest in CBDC has increased as a potential means of delivering their public policy objectives. Profound, ongoing changes across finance, technology, and society, as well as the recent COVID-19 crisis, provided additional impetus for the research of, and experimentation related to, CBDCs.

CBDC is a national digital currency issued by the central bank that is expected to replace or coexist with fiat money and hold the same value. Mobile money, on the other hand, utilises existing commercial banking-based accounting to manage customer wallet balances based on an exchange with cash or lines of credit and loans.

CBDC is a direct liability on the central bank as it is the main issuer of the currency, whereas digital money is the liability of commercial banks and other authorised financial institutions using funds on account. Although some implementation approaches propose that CBDC can be implemented in either an indirect or hybrid form, its liability remains on the respective national central bank.

National CBDC Initiatives

Russia is one of the leading global players in the development of blockchain solutions for a range of financial and public services, although regulation has yet to fully encompass the wide scope of these services.

The legal status of crypto-assets was clarified by the government with the adoption of Federal Law No. 259-FZ “On Digital Financial Assets, Digital Currency and Amendments into Certain Statutes of the Russian Federation” dated 31 July 2020 (Crypto Law). According to its provisions, crypto assets fall within the definition of digital currencies. The law came into force on 1 January 2021. Out of 27 Articles of the Crypto Law, only one deals directly with cryptocurrencies (or “digital currencies”).

The Federal Financial Monitoring Service is responsible for enforcing anti-money laundering and counter-terrorism financing rules. Rosfinmonitoring is currently working on the project to develop an AI-based cryptocurrency-transactions analysing system called “Transparent Blockchain”. These highlights efforts of governmental authorities to establish control over the circulation of virtual assets.

In 2020, the CBR continued the analysis of the prospects of the introduction of a digital ruble as the national digital currency, proposing models for its introduction. The CBR outlined the prospects of using another form of the Russian currency for reducing the cost of payment services, enhancing the resilience of the national financial system, and promoting the development of the digital economy.

The proposed four models for the implementation of the digital ruble were:

1. Model A. The CBR opens wallets for banks for interbank settlements.
2. Model B. The CBR opens wallets for customers and carries out settlements on them on the digital ruble platform, interacts directly with customers and conducts KYC2 and anti-fraud checks.
3. Model C. The CBR opens wallets for customers and carries out settlements on them on the digital ruble platform, while banks and financial intermediaries interact with customers, initiate the opening of wallets for customers and settlements on them, and perform AML/CFT and anti-fraud checks.
4. Model D. The CBR opens wallets for banks / financial intermediaries on the digital ruble platform, while banks and financial intermediaries interact with customers, open wallets, carry out settlements on them for customers on the digital ruble platform, and conduct AML/CFT and anti-fraud inspections.

The CBR analysed the advantages and disadvantages of these models and formulated additional questions on the subject for market participants. The opinions and answers of market participants were received and analysed, and meetings were held with credit institutions, associations, and depositories, during which potential advantages and risks of launching the digital ruble as well as the specifics of its operation in the Russian payment market were discussed. According to the survey, the majority of market participants favoured Model D.

In April 2021, the CBR published its digital ruble concept. The digital ruble will become the third form of Russia’s national currency and be the CBR’s obligation, aimed at enhancing the availability and safety of payments, reduce fees for transactions, and promote conditions for higher competition and the development of innovative platforms. In December 2021, the CBR designed a digital ruble platform prototype. Already in January 2022, the testing of the platform was launched with 12 banks. Based on the results of the testing, the CBR will make a decision on its implementation.

In August 2023, CBR tested the opening of digital ruble accounts and money transfers to them, person-to-person transfers, bill payments, and QR code-based payments. The goal is for both individuals and businesses to be able to actively use the national digital currency beginning from 2025.

Unregulated Cryptocurrency Products – Background 

Regulators and national central banks are challenged by unregulated independent cryptocurrency products. Whereas CBDCs are under the authority of the central bank, almost all cryptocurrencies are decentralised, and not controlled or managed by any central authority.

Obviously, financial market authorities and the national central banks are not in favour of unregulated cryptocurrency products, and they see them as a systematic risk for the financial system. Their intention to regulate the respective cryptocurrency exchange platforms has gained momentum.

Cryptocurrencies, originally designed as a store of value, are digital assets, developed and maintained on decentralised blockchains, and they can be used as a medium of exchange or payment method. Bitcoin and Ethereum are the most popular forms of cryptocurrencies worldwide used by consumers and businesses for transactions.

As of 2022, over 400 million people worldwide used cryptocurrencies, with merchants and businesses in more sectors accepting it as a form of payment. The major payment schemes VISA and Mastercard, PayPal and along with a growing number of financial institutions, have launched services allowing consumers to purchase or use cryptocurrencies for a range of applications.

According to a 2022 Deloitte survey, around two-thirds (64%) of surveyed merchants indicated that their customers have significant interest in using digital currencies for payments, and 83% expect consumer interest in digital currencies for payments to increase or significantly increase over the next 12 months.

In addition, merchants are motivated by the prospect of enabling immediate access to funds (40% of respondents), taking advantage of blockchain-based innovations in decentralised digital finance (39%), and allowing in-house management of the revenue cycle/treasury/finance department (39%).

Over half (54%) of large retailers (with revenues of $500 million and up) have invested more than $1 million on enabling digital currency payments, while only 6% of small retailers (with revenues of under $10 million) did so.

A 2022 survey from Checkout.com found a sharp rise in people wanting to use cryptocurrencies as a means of payment, with 40% of 18-35-year-old consumers citing their desire to experiment with using crypto as a payment method, up from less than 30% in 2021. Meanwhile, over 80% of businesses say offering crypto has attracted new customers, leading to a decrease in chargebacks, while just over 60% have seen higher authorisation rates accepting crypto payments.

Current estimates put cryptocurrency ownership in Europe at around 18 million people.

According to the CBR, some estimates put the amount of Russians’ transactions with cryptocurrencies at $5 billion a year. Russians are active users of online cryptocurrency trading platforms. Moreover, Russia is one of the world’s leaders by mining capacity. Cryptocurrencies include digital currencies as defined by Federal Law No. 259-FZ, dated 31 August 2020,6 (hereinafter, the law on DFAs) and DFAs that may be used in foreign jurisdictions to make payments.

Russian laws do not regulate the organisation of the issue or directly the issue and the circulation of digital currency. This means that cryptocurrency exchange offices, crypto exchanges, peer-to-peer (P2P) platforms, and other cryptocurrency market operators are beyond the legal framework. Moreover, the law on DFAs prohibits the use of digital currencies as a means of payment in the Russian Federation.

Market Size and Dynamics

Cards in Issue

The concentration of card issuance in Moscow, according to the central bank reflects the fact that most credit institutions are based in Moscow and issue cards for residents of the region and for customers in other regions. This applies to the issue of credit cards under consumer lending and debit cards under payroll projects.

Previously concentrated around greater Moscow and to a lesser extent the St Petersburg region, cardholding is now spreading more widely to regional cities. VISA historically held a market share of around two-thirds of international payment cards in Russia; Electron and Maestro debit cards represent most of the combined VISA and Mastercard card base.

Based on CBR figures, the number of payment cards and e-money cards in circulation rose from 74.6 million in 2006 to 746.06 million in 2023 (+9.53% from 2022), taking total card issuance to 5.10 cards per capita. Included in the total card base were 296.78 million e-money cards, 39.78% of the total card base. In 2023, debit cards and credit cards amounted to 52.91% and 12.14% of the total card base, respectively, and 60.11% of the payment cards were active cards.

In 2023, payment cards accounted for 3.07 of the total cards per capita, and there were an estimated 686 million contactless cards in circulation, 92% of all payment cards.

MIR cards – By the end of 2016, 64 banks had 1.76 million MIR cards in circulation, rising to over 5 million by April 2017, and 10 million by July 2017. By the end of 2021, 232 acquiring and 158 issuing credit institutions were participating in the MIR payment system. Under the pressure of sanctions, the importance of national payment instruments has increased. In 2023, there were MIR cards in circulation increased by 1.6x to 287.0 million, implying that there were about 1.9 MIR for every inhabitant of Russia.

14 - Business Cards in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Business cards issued (000s)	4,007	4,568	5,597	6,974	6,904	-1.01%	17.80%
Business cards in use (000s)	1,951	2,209	2,565	2,726	2,874	5.45%	15.06%
Value of transactions (RUR bn)	3,477.7	3,904.8	5,732.5	5,611.4	4,729.9	-15.71%	10.26%
- cash withdrawals	1,604.7	1,624.7	1,802.7	1,899.6	1,924.1	1.29%	4.89%
- payments	1,852.6	2,180.7	3,710.0	3,400.8	2,398.2	-29.48%	11.66%
- other transactions	20.4	99.4	219.7	311.0	407.6	31.05%	146.96%
Note: other transactions include bank card transactions not related to payments for goods, works and services (eg. card to card and card to bank account fund transfers, e-money uploads, fund transfers for charity purposes etc.)
Source: Central Bank of Russia (CBR).

Active Payment Cards – Arguably more significant is the proportion of active cards. Since 2009, CBR has reported figures for active payment cards, defined as those used at least once per quarter; this percentage rose from 50.8% in 2009 to 74.7% in 2012, falling sharply to 52.3% at end-2013, but grew again to 68.9% at end-2019 before declining to 60.1% by end-2023.

According to the CBR, in 2023, there were 449.28 million bank cards in circulation, of which 270.08 million were active cards. Active card penetration in Russia was 1.85 per capita at end-2023. Total active cards grew by 6.88% from 2022. Total transaction value amounted to RUR 166.96 billion (+11.54% from 2022). The payments value on active cards accounted for 32.58% of total transactions by number.

15 - Cash Withdrawals with Russian Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a cash function (000s)	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
Cash withdrawals per card per year	10.7	8.2	7.0	5.4	4.4	-17.57%	-17.46%
Number of withdrawals on cards (m)	3,054.2	2,494.1	2,343.6	2,139.1	1,997.2	-6.63%	-8.78%
- thereof withdrawals domestic (m)	3,033.5	2,480.7	2,329.6	2,139.1	1,997.2	-6.63%	-8.67%
- thereof withdrawals abroad (m)	20.7	13.4	14.1	0.0	0.0	NA	NA
Withdrawals value on cards (RURbn)	28,923.2	28,296.6	29,813.5	31,110.6	35,080.2	12.76%	4.46%
- thereof values domestic (RURbn)	28,656.5	28,073.8	29,579.0	31,110.6	35,080.2	12.76%	4.65%
- thereof values abroad (RURbn)	266.7	222.8	234.5	0.0	0.0	NA	NA
ATV per cash withdrawal (domestic) (RUR)	9,446.65	11,316.68	12,697.19	14,543.57	17,564.41	20.77%	14.59%
Total cash withdrawals per capita	20.8	17.0	16.0	14.6	13.7	-6.44%	-8.70%
Total withdrawals value per capita (RUR)	197,071.5	193,203.6	203,560.4	212,416.8	240,027.5	13.00%	4.56%
Note: cards with a cash function numbers have been restated.
Note: cash withdrawals include some at bank branches without the use of an ATM.
Source: CBR, BIS.

CBR also publishes statistics for payment cards issued to legal entities (businesses). There were only 6,903,885 such cards by end-2023 compared with the 449.28 million payment cards issued. Despite the 1.01% decrease in card numbers, about 2.8 million were classed as “in use” (41.63%). In 2023, the value of payments on these business cards was RUR 4,729.9 billion, almost double the amount for 2018.

16 - Payments with Russian Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a payment function (000s)	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.3%	10.5%
Ø payments per card per year	137.2	157.1	179.5	169.3	164.4	-2.9%	9.0%
Ø payment value (RUR) per card per year	222,993.4	256,135.8	309,106.2	310,685.1	302,814.4	-2.5%	10.7%
Payments on Russian cards (m)	39,217.0	48,028.5	60,084.9	67,158.9	73,848.3	10.0%	20.4%
- thereof payments abroad (m)	606.2	611.2	939.2	0.0	0.0	NA	NA
- with debit cards (m)	36,371.3	45,169.2	57,208.1	64,247.6	70,137.1	9.2%	21.0%
- with credit cards (m)	2,845.7	2,859.3	2,876.8	2,911.3	3,711.2	27.5%	12.2%
Value of payments (RURbn)	63,738.6	78,280.9	103,459.0	123,228.8	136,049.1	10.4%	22.3%
- thereof payments abroad (RURbn)	1,380.6	944.4	1,593.9	0.0	0.0	NA	NA
- with debit cards (RUBbn)	60,583.4	75,067.4	100,158.0	119,806.6	131,481.0	9.7%	22.7%
- with credit cards (RUBbn)	3,155.2	3,213.6	3,301.0	3,422.2	4,568.0	33.5%	13.6%
ATV per card payment (RUR)	1,625.28	1,629.88	1,721.88	1,834.88	1,842.28	0.4%	1.5%
Total card payments per capita	267.2	327.9	410.2	458.5	505.3	10.2%	20.6%
Total card value (RUR) per capita	434,290.3	534,486.9	706,397.7	841,381.9	930,881.6	10.6%	22.4%
Note: payments on Russian cards include utility bill payments on cards at bank branches, but exclude cash withdrawals.
Note: purchases on Russian e-money cards are not included in this table (see e-money use).
Source: CBR, BIS.

Card Fraud

Card fraud is one of the most fascinating aspects of the payments industry, not least because it is relentless and mutating. EMV implementation and 3D-Secure, combined with Strong Customer Authentication (SCA), have done much to reduce domestic losses from lost and stolen cards in Europe. However, the war against fraud losses and the changing face of fraud continues to be a threat for the payments industry, including Russia.

The global card fraud challenges are Card-Not-Present fraud (CNP), cross-border fraud and counterfeiting on non-EMV cards. CNP fraud accounted for 80% of the total value of card fraud losses in 2020. From 2017, a new payment fraud category are fraud losses on contactless card payments. International card fraud continues to be smaller in scale than domestic card abuse but is proportionately far more common. And of course, fraudulent cross-border transactions on cards continue to grow on all purchase channels.

Losses from card fraud on the internet and cross-border fraud on domestic cards have grown significantly. Following EMV implementation, card fraud has moved increasing to countries where POS terminals or online shops have not yet been migrated to EMV and SCA, respectively, and to cross-border fraud with compromised cards.

The breakdown of card fraud losses by method of compromise already indicates the importance of distinguishing between domestic and cross-border fraud losses. The method of compromise covers the means by which fraudsters obtain payment cards or card details. Notable methods of compromise in a complex payment world are CNP fraud based on theft of card credentials and card lost and stolen fraud followed by growing ID fraud and by cross-counterfeit fraud.

The main method of compromise responsible for losses in many European countries is now the theft of card credentials. A high proportion of these card fraud losses are caused by the growth in e-commerce, and still the lack of use of strong customer authentication methods such as 3D-Secure.

In a post-data-breach world, identity information, payment credentials, account credentials and responses to security questions are widely available for purchase in bulk. Complete fraud exploits and zero-day attacks are also easily available on the black market for outright purchase or as a hosted / fully managed service.

In the digital payments world and having the changing face of fraud in mind, there are significant challenges for card issuing banks, payment service providers and their supporting processors.

According to a Fair Isaac Corporation (FICO) report, in 2018, card fraud losses in Russia decreased by 12.76% on 2017.

Russia’s card fraud loss mix is different from European trends. Counterfeit fraud (29.5%) declined slightly, and CNP fraud grew rapidly compared to 2017, reaching 14.7% of all card fraud in 2018.

There is still some caution over making payment by cards over the Internet, and cash-on-delivery use is still quite high in Russia. In 2018, CNP fraud represented 14.7% of losses, rising sharply as criminals become more sophisticated in their approaches. The UK and Germany had CNP at 70% of the total card fraud mix, and this trend is expected to come to Russia. FICO did not update its figures for 2022 and 2023.

Russia continued to see fraud losses increase, with those losses being split evenly across Lost or Stolen, Counterfeit and ID Fraud, with the latter having a sharper increase, since 2014. Criminals have targeted ID Fraud as banks have started pushing back on the fraud they had seen in Lost or Stolen and Counterfeit, which is a natural migration path.

Basis points of fraud losses overall are still quite low, but this may change as the purchasing behaviour and confidence in cards in Russia changes. Russia is still the one to watch in terms of growth and banks are being challenged by criminals in all areas, as seen by the even split in fraud types. Investment across the channels will be required to control the fraud losses.

In relation to fraud, the CBR reported that the number of unauthorised transactions rose to nearly RUB 14.2 billion in 2022, from RUB 13.6 billion in 2021. The share of the volume of fraudulent transactions in the total volume of card transactions in 2022 amounted to 0.00097% (2021: 0.00130%) which does not exceed the target indicator for the share of such transactions in the total volume of transactions (0.005%) set by the Bank of Russia. In 2023, unauthorised transactions accounted for 0.00119% in total funds transfers (vs 0.00097% in 2022). This was below the target set by the Bank of Russia for the portion of such transactions in total transactions (0.005%). The regulator prevented 34.77 million theft attempts worth RUR 5,798.35 billion.

As before, cyber fraudsters targeted not banks, but rather their clients in 2021. To swindle money, fraudsters continue to use phishing and telephone calls, promptly adjusting their schemes to the news. Over the year, the CBR initiated the blocking of over 6,000 websites created by fraudsters. With the participation of the CBR, the authorities developed a law, according to which the regulator was empowered to initiate the blocking of fraudulent websites extrajudicially beginning from December 2021. In 2022, the Bank of Russia interacted with domain registrars to block fraudulent resources. During the reporting period, the Bank of Russia sent domain registrars information on 5,217 Internet resources used to commit illegal acts in the financial sector. In addition, there was information about 10,716 Internet domains was sent to the General Prosecutor’s Office of the Russian Federation in order to restrict access. In 2023, for appropriate measures to be taken to prevent fraud, the Bank of Russia sent information about over 500,000 phone numbers used for illicit purposes to telecom operators. Based on the Bank of Russia’s requests, the Prosecutor General’s Office of the Russian Federation and domain registrars were blocking fraudulent internet resources

As most POS card transactions are now authorised online-to-issuer, acquirer card fraud losses in Russia are under control except for offline vending machines, e-commerce, and other hotspots.

Credit card fraud prevention measures taken have been pushing 3D-Secure, updating bank fraud prevention systems and real-time-scoring, implementing more rule-based fraud control mechanisms. Also, issuers offer PIN selection at ATMs and SMS notification to inform cardholders about the use of their credit card.

FinCERT – In March 2016, the CBR revealed plans to double the staff of its FinCERT unit, a special division set up to fight cybercrime in the credit and financial sectors. More than 800 Russian institutions and banks are connected to the FinCERT system. In 2016, FinCERT saved Russian banks more than USD 30 million by thwarting cyber-criminal’s attempts to break into Russian banks.

Card Use

Though CBR and BIS figures are aligned in respect of the number of bank cards issued, there are some discrepancies in respect of the value of cash withdrawals and POS payments – the only other set of figures which both CRBF and BIS publish. Like in many other European countries, the central banks include third party cards (e.g. American Express and Diners Club cards) in their transaction statistics while BIS includes bank card transactions only.

The number of transactions with payment cards issued by Russian banks, including international transactions, has risen at a steady pace over the past decade. In consequence, transactions per card per year have risen at an accelerated rate, and the value of transactions series tells a similar story, though some of the increase reflects inflation rather than underlying growth.

Cash withdrawals previously dominated Russian card use, but the use of cards for POS payments rather than ATM withdrawals is increasing. Figures from CBR for ATM and POS transactions show the ATM proportion slipping from 86.2% of transactions by value to 20.50% over the period 2005 to 2023.

Cash withdrawals on cards – According to the CBR, in 2023, there were 1.99 billion withdrawals on cards (-6.63% from 2022) with the total withdrawals value RUB 35.08 trillion (+12.76% on 2022). In total, there were on average 4.4 withdrawals per card per year, and the ATV per cash withdrawal accounted for RUB 17,564.41 (+20.77%) or $207.48 equivalent.

18 - Payments with Russian Debit Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Debit cards (000s)	248,648.0	266,479.4	294,267.0	349,207.1	394,729.8	13.04%	10.69%
Ø payments per debit card per year	146.3	169.5	194.4	184.0	177.7	-3.42%	9.31%
Ø payments value (RUR) per debit card per year	243,651.3	281,700.4	340,364.3	343,081.8	333,091.2	-2.91%	10.83%
Payments (m)	36,371.3	45,169.2	57,208.1	64,247.6	70,137.1	9.17%	21.00%
Value of payments (RURbn)	60,583.4	75,067.4	100,158.0	119,806.6	131,481.0	9.74%	22.68%
ATV per debit card payment (RUR)	1,665.69	1,661.91	1,750.77	1,864.76	1,874.63	0.53%	1.39%
Note: debit card figures include delayed debit card data; payments include payments to retailers and in bank kiosks.
Source: CBR, BIS.

Payments on cards – According to the CBR, in 2023, there were 73.85 billion card payments (+10.0%) with a total payment value of RUR 136.05 trillion (+10.4% from 2022). In total, there were on average 164.4 payments per card per year, and the ATV per card payment accounted for RUR 1,842.28 (+0.4%) or $21.76 equivalent.

19 - Payments with Russian Credit Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Credit cards (000s)	37,183.9	39,143.4	40,436.7	47,428.6	54,552.3	15.02%	9.23%
Ø payments per credit card per year	76.5	73.0	71.1	61.4	68.0	10.83%	2.73%
Ø payments value (RUR) per credit card per year	84,854.3	82,097.7	81,633.7	72,154.7	83,737.1	16.05%	3.96%
Payments (m)	2,845.7	2,859.3	2,876.8	2,911.3	3,711.2	27.47%	12.21%
Value of payments (RURbn)	3,155.2	3,213.6	3,301.0	3,422.2	4,568.0	33.48%	13.55%
ATV per credit card payment (RUR)	1,108.78	1,123.90	1,147.46	1,175.47	1,230.89	4.71%	1.20%
Source: CBR, BIS.

Utility Bill payments on cards – Payments on Russian cards include bill payments on cards at bank branches. In 2016, there were 5.2 million utility payments on cards (+42.3%) with the total value RUR 14.5 trillion (+52.3% on 2015). This compares to 8.84 million POS payments on cards with the total value RUR 8.46 trillion. CBR provided no subsequent update.

Card Use per Capita

Card use in Russia is high compared with the other Eurasian countries. Card payments per capita were 505.3 in 2023 (+10.2% from 2022), up from 267.2 in 2019 (CAGR +20.5%).

In addition, there were 28.4 e-money purchases per capita, and 13.7 cash withdrawals per capita in 2023.

Debit card use was 479.9 payments per capita (+9.40%), but credit card use was just 25.4 payments per capita (+27.74%). Credit card use in Russia continued to be significantly lower than debit card use.

20 - Top-10 in the Russian Credit Card Market
Bank	Portfolio (RURbn)				Market Share in Credit Card Market
	in Q4 2017	in Q4 2018	in Q4 2019	in Q4 2020	end-2017	end-2018	end-2019	end-2020
Sberbank	510.6	588.6	700.9	703.4	45.5%	44.9%	43.9%	43.4%
Tinkoff Bank (TCS)	130.2	154.4	212.7	227.3	11.6%	11.8%	13.3%	14.0%
Alfa-Bank	93.6	145.1	171.7	182.7	8.3%	11.1%	10.8%	11.3%
VTB Bank	92.6	94.6	107.6	100.1	8.3%	7.2%	6.7%	6.2%
Russian Standard Bank	43.8	55.6	77.5	72.1	3.9%	4.2%	4.9%	4.4%
Orient Express Bank	46.2	56.7	61.2	57.4	4.1%	4.3%	3.8%	3.5%
Sovcombank	6.6	18.7	23.4	81.7	0.6%	1.4%	2.6%	5.0%
OTP Bank	21.2	21.8	22.6	20.7	1.9%	1.7%	1.4%	1.3%
Raiffeisenbank	15.9	17.9	19.7	na	1.4%	1.4%	1.2%	na
Otkritie Bank	21.5	16.5	na	na	1.9%	1.3%	na	na
other banks	161.0	159.6	197.7	175.6	14.4%	12.2%	12.4%	10.8%
Total credit card market	1,121.7	1,313.0	1,595.0	1,621.0	100.0%	100.0%	100.0%	100.0%
Source: Tinkoff Bank credit card market report 2020.

Debit Card Use 

The Russian card market is dominated by debit cards issued for payroll projects in which companies make regular salary and other payments to their employees through international or domestic bank cards. Payroll cards account for a high percentage of debit cards issued, and for almost all the cards historically issued under local interbank schemes and proprietary banking projects. MIR, Maestro, and VISA Electron are the chosen brands for payroll accounts (see Payroll Schemes below).

In 2023, there were an estimated 70.14 billion debit card payments (+9.17%) on 394.73 million debit cards with a total estimated value of RUR 131.48 trillion (+9.17% from 2022). The ATV per debit card payment amounted to RUR 1,874.63 or $22.14 equivalent. From the issuers’ perspective, there were on average 177.7 payments per debit card per year, down 3.42% in the past year. Debit card payments have grown by a CAGR of 21.00% between 2019 and 2023.

21 - E-money Use in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
E-money institutions (EMIs)	86	80	69	68	60	-11.76%	-8.39%
Total e-money purchases (m)	2,420.2	2,914.6	3,276.5	3,417.9	4,154.4	21.55%	16.95%
Total e-money purchases value (RUR bn)	1,438.9	1,494.9	2,671.9	3,041.5	4,333.4	42.48%	28.99%
ATV per e-money purchase (RUR)	594.55	512.89	815.47	889.88	1,043.08	17.22%	10.29%
Number of e-money accounts (000s)	257,117.4	356,262.3	364,040.9	284,507.3	296,781.8	4.31%	9.71%
Number of e-money operations (m)	2,789.3	3,118.7	3,276.5	3,417.9	4,154.4	21.55%	13.82%
Value of e-money operations (RUR bn)	1,967.6	1,829.4	2,671.9	3,041.5	4,333.4	42.48%	20.93%
ATV per e-money operation (RUR)	705.42	586.57	815.47	889.88	1,043.08	17.22%	6.25%
Total e-money operations per capita	19.0	21.3	22.4	23.3	28.4	21.81%	13.92%
Total e-money operations value (RUR) per capita	13,406.8	12,490.4	18,243.0	20,766.7	29,650.4	42.78%	21.05%
Note: e-money operations include all personalised and non-personalised e-money transactions, including e-money purchases on e-money cards.
Source: CBR, BIS.

Credit Card Use

In 2023, there were an estimated 3.71 billion payments on credit cards (+27.47%) with a total estimated value of RUR 4.57trillion (+33.48% from 2022). The ATV per credit card payment amounted to RUR 1,230.89 or $14.54 equivalent. From the issuers’ perspective, there were 61.4 payments per credit card per year. Credit card payments have grown by a CAGR of 12.21% between 2019 and 2023.

22 - Sberbank Key Figures
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Active retail clients in Russia (m)	96.2	98.9	103.0	107.0	108.5	1.4%	3.2%
Cards issued (m)	131.0	138.1	146.2	154.8	155.0	0.1%	4.6%
- of which debit cards	115.0	123.1	132.2	137.0	135.0	-1.5%	4.5%
- of which credit cards	16.0	15.0	14.0	17.8	20.0	12.4%	5.6%
Number of ATMs and self-service terminals (000s)	76.9	70.4	67.7	65.6	65.6	0.0%	-3.5%
POS terminals at Russian merchants (000s)	2,201.0	2,187.0	2,377.5	2,367.0	2,250.0	-4.9%	4.6%
Note: Sberbank key figures are for Russia, excluding subsidiary banks.
Note: cards issued figures from 2018 onwards are for active cards only.
Note: on the use of branch devices for cash withdrawals and/or card payments, all Sberbank self-service terminals are deemed to be ATMs.
Source: Sberbank.

The leading credit card issuers are Sberbank, Tinkoff Bank, Alfa-Bank, VTB Bank, Orient Express, Russian Standard Bank, Okritie Bank, OTP, Raiffeisenbank, and Sovcombank. By virtue of its size and focus on credit cards, Sberbank remained the credit card market leader at the end of 2020, however its market share decreased between 2019 and 2020. According to figures compiled by Tinkoff Bank, Sberbank’s credit card loans outstanding rose to RUR 703.4 billion in Q4 2020, amounting to 43.4% of the total market.

Tinkoff Bank ranked second, with credit card loans around a third of Sberbank. Other leading lenders were VTB Bank, Alfa Bank and Orient Express Bank.

23 - Russian Remittances
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Remittances from Russia ($m)	7,541	7,400	8,662	632	632	0.00%	-41.82%
- to non-Eurasian countries	1,445	1,207	1,085	379	379	0.00%	-28.45%
- to Eurasian countries	6,096	6,193	7,577	253	253	0.00%	-49.18%
Remittances to Russia ($m)	3,329	3,119	3,237	1,363	1,363	0.00%	-12.47%
- from non-Eurasian countries	1,832	1,719	1,866	184	184	0.00%	-28.48%
- from Eurasian countries	1,497	1,400	1,370	1,179	1,179	0.00%	-6.73%
Balance ($m)	-4,212	-4,281	-5,425	-731	-731	0.00%	-36.04%
- non-Eurasian countries	387	512	781	196	196	0.00%	-171.66%
- Eurasian countries	-4,599	-4,793	-6,206	-926	-926	0.00%	-30.70%
Average remittance value ($):
- from Russia	407	273	273	383	383	0.00%	-2.60%
- to non-Eurasian countries	749	520	547	414	414	0.00%	-15.66%
- to Eurasian countries	368	250	255	345	345	0.00%	-1.91%
- to Russia	238	273	408	216	216	0.00%	-16.62%
- from non-Eurasian countries	176	214	422	583	583	0.00%	3.54%
- from Eurasian countries	416	417	391	197	197	0.00%	-19.09%
Note: data covers cross-border remittances via money transfer systems and Russia’s postal service.
Note: the figures for 2022 are incomplete and do reflect Q1 2022 only.
Source: Central Bank of Russia (CBR).

E-money Use

According to CBR, there were 296.78 million e-money cards in circulation, up by 4.34% from 2022, and 4.15 billion e-money purchases (+21.55%) with a total value of RUR 4.33 trillion (+42.48% from 2022). The ATV per e-money purchase accounted for RUR 1,043.08 or $12.32 equivalent. In total, there were 28.4 e-money purchases per capita.

CBR includes all kinds of virtual e-money cards/accounts and prepaid e-wallets in its e-money statistics. The bank of International Settlement (BIS) reported slightly lower e-money use figures (see upper part of Table 25).

Leading Card Issuer Details

Sberbank issues contactless cards branded MIR, Mastercard, and VISA debit cards. In addition, Sberbank

supports Apple Pay, Samsung Pay, and Android Pay.

The majority of payment cards in Russia are issued by Sberbank. In 2023, Sberbank had 135 million debit cards and 20 million credit cards. More than 60 million Sberbank cards were contactless cards.

The end-2023 figure of 20 million credit cards compares with only 1.9 million in December 2010, when Sberbank said it was targeting 4 million by end-2011. The card figures in Table 25 are for total valid cards in circulation.

Sberbank reported that during 2020, sales of SberCard, a new card product with a dynamic fee system, were growing. The card fee depends on the client’s segment, transactions or balance and is updated monthly. The product has been available for all clients since September 2020. Service operations relating to debit and credit cards through digital channels accounted for over 50%.

According to Sberbank, the bank card has become the most popular payment tool in public transport in Russian regions–today more than half of passengers in the cities where Sber’s transport acquiring has been introduced pay for travel with a bank card, and this share doubled over 2020.

In 2020, all corporate clients and individual entrepreneurs were able to remotely join the payroll card programme via SberBusiness Online, with applications registered automatically in one minute. Sber offered retail clients a tool allowing them to connect their current card to the employer’s payroll card programme using the SberBank Online mobile app, without issuing a new card. The card is given the salary status as soon as the first amount of money is credited to the card account from the employer. This service was in particularly high demand during the COVID-19 pandemic.

SberSpasibo is the largest loyalty programme in the Russian banking market.  The service was used by more than 346,000 participants who transferred 149.7 million bonuses. In 2020, more than 400 promos were held together with programme partners with the total number of the participants exceeding 13 million, the number of purchases reaching turnover of RUB 19 billion.

VTB Group’s retail banking units comprise VTB24, Bank of Moscow and Leto Bank, with a total of 39.5 million cards issued at end-2022 of which 10.5 million were classed as active. From March 2022, VTB cards have no expiration date. Also, the Bank keeps processing cards issued by foreign payment systems, which remain valid in Russia. Hence, the decision of international payment systems to discontinue operations in Russia did not affect the service provided to VTB customers domestically. The Bank gave no update on the total number of cards in 2023 but reported that it issued more than 1.7 million credit cards in 2023. VTB Group figures comprise cards issued by VTB24 Bank, VTB Bank and Post Bank, including salary cards and pensioners cards. The bulk of cards issued were the Bank’s flagship card product, Multicard, which also accounted for the bulk of purchases.

During 2020, VTB transferred processing for all pre-approved loans and digital credit cards through VTB Online to a new retail credit conveyor (RCC 2.0). The volume of applications processed through RCC 2.0 quadrupled, while the processing time decreased three-fold. The approval rate for loan applications in the new conveyor for guaranteed pre-approved offers increased from 53% to 64%.

Bank of Moscow, absorbed by VTB Bank, was the issuer of the ‘Muscovite’s Social Card’ project, a joint effort of the government of Moscow, Moscow metro and a number of other organisations designed to improve the delivery of services to the city inhabitants. VISA Electron-based, the Social Card is issued for retirees, students, public servants and municipality employees and combines bank settlement and ID card functionalities. The cards were estimated to account for about half of the bank’s 11.9 million card portfolio at end-2014.

VTB launched Apple Pay (for Mastercard) and Samsung Pay (for VISA) in Q4 2016. VTB said that over 40,000 users had downloaded Apple Pay and Samsung Pay, conducted 700,000 transactions, and generated more than RUR 1 billion on cards tied to them by end-2016. In addition, VTB, Mosgortrans and Mastercard implemented a project to allow users to pay for land transport in Moscow using bank cards and smartphones through Apple Pay, Android Pay and Samsung Pay. VTB acted as the acquiring bank for the project.

Gazprombank issues cards branded MIR, VISA, Mastercard, JCB and UnionPay. In 2021, the bank had around 2.5 million cards in circulation. In December 2015, Gazprombank issued its first co-badge card, the MIR Maestro card. In August 2016, the bank issued its second co-badge card, the MIR JCB card.

Gazprombank’s retail banking business is focused on employees of corporate customers and individuals with middle and high-income levels. Gazprombank offers card-based payroll services to more than 4,100 corporations.

During 2020, Gazprombank continued to actively develop its card business by focusing on digital services and a personalised approach to cardholders while also offering new products during 2020. The average card balance of cardholder individuals grew by 22% and total spend rose by 18%. Gazprombank implemented virtual credit card issuance in its mobile app. Among new card products launched in 2020 was the Convenient Card credit card with a flexible grace period determined automatically depending on how much the customer spends every month.

Alfa Bank – issues contactless cards branded MIR, Mastercard and VISA. In addition, Alfa Bank supports Apple Pay, Samsung Pay and Android Pay. In 2022, Alfa Bank had over 26 million cards in circulation and claimed an 11% share in the credit card market.

In 2019, in cooperation with Yandex and Mastercard, Alfa Bank issued a Yandex.Plus card with cashback of up to 10% for Yandex services (a total of 15 services, including Taxi, Eda, Drive and Afisha), and free subscription to Yandex.Plus subject to spending RUR 5,000 or more per month. The card and service are free, with 6% per annum on the balance. The new card may be issued in the form of a credit card.

Alfa has also contracted with its group associate, X5 Retail Group, to launch co-branded cards for Perekrestok and Karusel that serve as payment cards and loyalty cards for these supermarket chains. A programme with another group associate, VimpelCom (owner of the Beeline brand), is the co-branded VISA-Beeline “Minutes for Purchases.” Beeline subscribers holding the cards pay for goods and services using the card and receive bonus minutes on their mobile account.

In 2020, Alfa-Bank strengthened its position in the payroll market, with more than 2 million active payroll clients. Alfa-Bank was the first among Russian banks to introduce daily salary accrual (which can be activated directly from the mobile app) for its payroll customers. In spring 2020, Alfa-Bank and Beeline announced a long-term partnership on technological integration, launching a series of co-branded bank cards with unique offerings.

Russian Agricultural Bank (RAB) began issuance of domestic and VISA payment cards only in 2008 and reported 700,000 cards as at end-2010. All payment cards issued by the bank are EMV cards and many have been issued under RAB’s payroll card programme, which serves over 9,000 enterprises (2009: 4,400). In 2016, RAB reported 3.6 million cards, up by 10.7% on 2015. It issues contactless debit cards and credit cards branded MIR, Maestro, Mastercard, VISA, or UnionPay. RAB reported over 4 million cards in circulation in 2022.

In July 2018, RAB launched a co-branded Panasonic JCB card. The co-branded cards join the Club Panasonic Loyalty Program on special terms and receive 10,000 welcome bonus points. RAB’s cards are customised for personal use, for payroll projects, covering the needs of SMEs and large businesses, particularly in the agricultural sectors. The bank offers a ‘Farmer’ card on special terms

Uralsib Bank – Headquartered in Moscow, Uralsib operates nationally, with its main strength in its home region in central Russia. It had an estimated 2.5 million cards as at end-2021, of which 2 million were debit cards.

Tinkoff Bank (TCS) claims to be the largest digital-only bank in Russia with 40.4 million total customers as of 2023 (with 28 million classed as active customers), who held 33.5 million debit cards and 13.1 million credit products. According to Tinkoff, it is the leader in retail debit card features, with its Tinkoff Black premium debit card product at the core of its ecosystem. There were over 24.5 million total Tinkoff Black customers as of 1 January 2023.

In October 2020, Tinkoff and Burger King launched Russia’s first fast-food card. The co-branded limited edition debit card included cashback rewards for one year for spending money at Burger King. Only 10,000 cards were issued.

UniCredit Bank issues contactless debit and credit cards branded MIR, Mastercard or VISA in Russia. It reported 480,000 cards issued, down slightly from 540,000 cards in 2008. In 2019 it launched Samsung Pay, and the corporate Mastercard Business World card with the OneTwoTrip loyalty programme. In 2019 the bank increased sales of credit cards by over 20% over 2018. During 2020, UniCredit reinforced its existing card line-up, including enabling clients to issue virtual customs cards. The launch of the new VISA Infinite card in cooperation with the SOUND UP Festival of Contemporary Academic Music and VISA in March 2020 allowed UniCredit Private Banking customers to gain access to a specialised digital space.

Raiffeisen Bank issues contactless debit and credit cards branded MIR, Mastercard or VISA in Russia. In addition, Raiffeisenbank supports Apple Pay, Samsung Pay and Android Pay.

Rosbank (UniCredit Group) issues contactless debit and credit cards branded MIR, Mastercard or VISA in Russia.

Russian Standard Bank (RSB) holds a unique position in the Russian market as the largest privately-owned bank in Russia focused on credit cards and consumer finance. With its origins in the Russian Standard vodka business, RSB has a raffish image, but it is a key player in POS lending and credit cards.

In 2022, RSB issued debit cards branded MIR or VISA Debit and credit cards of the following brands: VISA, Mastercard, American Express, Diners, Discover, and UnionPay. RSB said that there were 25 million cards in circulation.

RSB claims 28 million customers in Russia and Ukraine and market leadership in delayed debit and credit cards and claims to have a wide credit cards portfolio from mass to premium segment. As noted above, its market share began to slip during 2014 and its leadership has been usurped by Sberbank.

In June 2011, RSB announced an agreement to form a new Diners Club International franchise in Russia, assuming all responsibility for the Diners Club and Discover brands and business in Russia and the Ukraine in issuing and acquiring. Issuance of Diners Club cards began in 2012 with three programmes.

RSB has issued (since 2005) and acquired (since 2007) American Express cards in Russia, servicing the Amex network of 90,000 merchant locations. In 2011, RSB launched several new co-branded programmes, two of which involved Mastercard and American Express cards. Its programme with the mobile phones network operator MTS comprises a Mastercard card and an American Express card linked to the same account. With British Airways, RSB offers an American Express Classic card and a Mastercard Standard debit card.

Towards end-2011, RSB launched Travel RSB cards, its own loyalty programme for travellers. RSB Travel cards are issued within the packages of classic (American Express Classic and Mastercard Standard) and premium (American Express Premium and World Mastercard) cards. RSB Travel card packages allow their holders to accumulate bonuses for purchases, including car rental, hotel accommodation and flight tickets.

In April 2010, RSB was successful, along with Alfa-Bank, Renaissance Credit and Cetelem in tendering to provide consumer credit to M.Video, one of the biggest Russian electronics and household goods chains. MVID’s turnover was $83 billion in 2009, of which 15% was on credit, forecast to rise to 20% in 2010.

In 2019 RSB launched the Mastercard World debit card and the Platinum 100 credit card, which offers a 100-day interest-free period. It also launched biometric ID for mobile payments, through the solution SoftPOS. RSB also launched instant payments with QR codes.

Home Credit Bank (HCB), the consumer finance specialist owned by PPF Group, the Czech insurance and banking group, entered the Russian market in 2002 by acquiring Innovacioniy Bank, renamed Home Credit & Finance Bank and integrated into Home Credit Group. The top company, Netherlands-registered Home Credit BV, owns consumer lending businesses in Czech Republic, Slovak Republic, Kazakhstan, Belarus and HCFB in Russia.

HCB reported over 3 million active clients and 77,000 distribution points as at end-2012. HCB also claimed No 1 spot in the POS loans market, with a 24% share, and said deposits by customers covered 56% of its liabilities. Home Credit Bank issues contactless debit and credit cards branded MIR, Mastercard or VISA.

Citibank was the first major western issuer to launch revolving credit cards in Russia, with two Mastercard programmes in late 2003. Citi has said in the past that it treats Russia as a priority market and strategy is to become the leading bank in Russia for middle class, emerging affluent and affluent clients.

At end-2020, Citi reported around 500,000 customers, including 280,000 credit card holders. In mid-2012, Citi announced it had agreed to offer continuing banking facilities to HSBC’s Russian retail customers when HSBC pulled out. The bank’s network consists of 11 branches and around 500 ATMs.

Credit card offerings include contactless Mastercard-branded co-brands with Miles & More, the largest frequent flyer programme in Europe, and Aeroflot. All Citi Select and Citi PremierMiles cards have now a PayPass function.

An important launch in 2012 was Citi Express Card – Mastercard, incorporating a contactless chip for the Moscow metro, similar to Citi ‘transport’ credit cards in Singapore, Delhi, New York and Washington, D.C. In July 2013, the service was expanded to include Mosgortrans, the operator of Moscow’s public buses, trams and trolleybuses. It also enables validation of parking at the transit parking facilities of the Moscow Metro.

Cetelem, the consumer finance arm of BNP Paribas (F), signed an agreement with Sberbank in December 2011 to launch a point-of-sale finance joint venture. Though the venture is using the Cetelem brand, Sberbank’s shareholding is 70% with BNP Paribas holding the 30% balance. At the time, Sberbank was targeting a 25%-30% market share in POS finance over the next two to three years.

Analysis of the POS finance market carried out for Sberbank in 2012 showed Home Credit (23.3%) and OTP Bank (22%) to be the biggest players, followed by Alfa Bank (14.4%), and Russian Standard Bank (14.3%); Cetelem had just 4.5%. About 35 million people were estimated to have used POS finance, 6.1 million of them regularly.

Previously, in July 2004 Cetelem announced the planned purchase for $300 million of 50% of a holding company which owned over 90% of Russian Standard Bank from Roust group. However, in January 2005, Cetelem said the deal had been terminated because of the alleged failure of Roust group to complete its part of the agreement.

Payroll Cards

MIR, Maestro, and Electron cards were often issued under payroll schemes. Under these schemes, large and small companies, as well as some government agencies and departments, pay employee salaries into a bank account, which is then accessed by the card. In the early days of these schemes, employees typically withdraw all or most of the funds immediately, but as confidence and familiarity build, more money is left in the accounts and an increasing proportion gradually tends to be used at the POS.

Mastercard joined forces with Nadra Bank, a long-standing partner which served the Ukrainian mining industry, to issue credit cards to the bank’s salary/payroll cardholders. The credit cards offered a 45-day grace period and cashback of 1% for every $100 spent on purchases. Nadra was active in seeking payroll business, reporting 130 such projects as of April 2012 and adding that it received salaries and social benefits for about 495,000 individuals.

Mastercard Electronic, a card product designed for emerging markets, linked to credit facilities, and providing 100% authorisation of POS payments, was launched in December 2003 by Nadra Bank. More than 20 banks took up licences to issue Mastercard Electronic and the number of cards issued was expected to reach 2 million over two to three years. By end-2009, Nadra’s card base had fallen by 80% from its peak level, but under new direction it is now recovering.

In 2017, President Vladimir Putin signed a law that established an obligation for Russian banks to use MIR as a national payment system, requiring its use to process all state welfare, civil servant salaries and pension payments by July 1, 2020. In April 2019, the Russian Government issued a decree with a list of social payments, which were mandated to be transferred to MIR payment system cards. Since May 2019, maternity benefits, childcare benefits and temporary incapacity benefits have been transferred to MIR cards. As such, international payment scheme payroll cards will no longer be used.

Sberbank is the leading provider of payroll payment services, though its market share appears to have slipped in recent years. Sberbank claimed three years ago to manage payroll accounts for over 50% of Russia’s workforce. Including pension payments, the number of people receiving their salaries and pensions through Sberbank was about 48 million in 2011-12 but fell to 42.9 million in 2013. In 2016, Sberbank reported 35.4 million payroll cards. In 2017, Sberbank claimed a 56.5% market share in the payroll client market. In 2018, Sberbank launched a transactional app to allow small businesses and individual entrepreneurs to pay without cash using mobile devices. It said that 300,000 business clients had already taken up use of this app in its annual report.

In its 2013 annual report, Sberbank said the number of active payroll bank cards it managed for businesses and state employees rose by 1.9 million to 21.1 million cards, while payroll payments rose 28% to RUR 6,300 billion. The number of pensioners receiving a social pension through Sberbank rose to 21.8 million in 2013, representing 53.2% of the total number of social pensioners in Russia.

In previous reports, Sberbank has said that 95% of people who receive pensions from national security, defence and law enforcement agencies do so through a Sberbank account, while 46% of social pensioners receive their pensions through Sberbank.

Since 2011, Sberbank has been implementing a project to migrate pensioners to card-based services. Customers who receive their pensions on their Sberbank Social Maestro Card earn annual interest of 3.5% on their account balance. During 2011, the proportion of Sberbank’s pensioner customers receiving their pension in a card account rose from 25% to 38%.

For civil and military pensioners, people receiving unemployment benefit and mothers receiving child benefit, the Sberbank Social Maestro Card offers minimum commission fees; since March 2012, these customers have been exempted from cash withdrawal charges and service charges.

In 2012, over 4,000 retail trade and service outlets targeting pensioners as a customer group agreed to provide discounts to holders of Sberbank Social Maestro Cards.

VTB Bank said in its 2014 annual report that 6,200 new payroll projects were signed up during the year. In 2016, VTB lifted the total to over 32,600 payroll projects, up from 27,000 payroll projects in 2012. At end-2017, VTB increased the number of payroll clients by 12.6% to 6.1 million people. By 2018, this figure had increased to 6.5 million payroll clients.

In 2016, VTB started issuing payroll cards under the MIR payment system, and it created a platform at Post Bank to work with payroll clients and pensioners.

Including Bank of Moscow and TransCreditBank, VTB24 had issued 7.7 million payroll cards by end-2011, up from 3.8 million as at end-2010. However, for 2012 the group’s payroll cards fell back to 6.4 million because of the loss of 2.1 million previously managed by TransCreditBank. One of the biggest customers in 2012 was Russia’s Ministry of Defence, for which VTB24 managed around 1 million payroll cards. In addition, Bank of Moscow operated 37,000 payroll projects, with 662,000 cards issued to employees.

Alfa-Bank, the biggest private bank, issued 700,000 payroll cards in 2013, but gave no update for the segment. Its cards issued overall rose 19.3% to 10.6 million.

While many payroll schemes are for small companies with 20-50 employees, because of the huge size of some Russian enterprises, others can be as big as 5,000-10,000 cards issued to workers in a single entity such as a metallurgical plant. Even bigger are the salary projects within Russia’s ‘closed cities,’ those which undertook strategic functions like armaments production in Soviet times. Norilsk, the Arctic nickel and platinum mining complex operated by Interros, the group which formerly controlled Rosbank, is an example of one of the biggest closed cities.

Payroll projects tend to be driven by employers, because they enable the closure of cash distribution desks, savings on cash delivery and reduced staff queuing time. Employees have often resisted them in the past, not least because the choice of bank is made for them by their employer, but with greater familiarity and convenience, payroll projects have become generally accepted.

International Money Transfers

International money transfers, also known as remittances, are an important payment mechanism in Russia and the Eurasian region, in common with many other emerging countries where migrant labour is an entrenched way of life. Internet, mobile and card-to-card based remittances are becoming increasingly popular in Russia.

Remittances from Russia grew from $3.5 billion in 2005 to $20.6 billion in 2014. Excluding remittances made by bank payment agents, remittances accounted for $8.66 billion in 2021. According to figures from CBR, the central bank, 87.5% of remittances were from Russia to other Eurasian countries (2014: 88.9%). There was a negative balance of $5.42 billion in 2021 between Russian remittances to the Eurasian region and those from Eurasia to Russia. In 2022, CBR temporarily suspended the publication of cross-border transfers of Individuals and no update was provided for 2023.

The CBR figures are compiled from returns submitted by the main money transfer companies – Anelik, BLIZKO, Coinstar Money Transfer, CONTACT, InterExpress, Migom, MoneyGram, PrivatMoney, Unistream, Western Union, AsiaExpress, ALLURE, Colibri (formerly Blitz), Bystraya Pochta, Guta Sprint, Zolotaya Korona, and LIDER.

Several are bank-owned, including BLIZKO (Svyaz-Bank), Bystraya Pochta (Raiffeisenbank) and Colibri (Sberbank).

WorldRemit – In February 2017, WorldRemit launched new money transfer corridors across Russia in collaboration with the Russian Payment System CONTACT. Now the service has been scaled up to the CIS-markets. WorldRemit users can now send money to be collected as cash pick up at more than 3,000 locations in Ukraine, 330 POS in Kazakhstan, 120 POS in Belarus and 65 POS in Armenia.

With the WorldRemit app or website, people in more than 50 countries can send instant, secure money transfers to more than 125 destinations.

Appendix

Foreign Investors and the Russian Banking Sector

In contrast to most CEE countries, the involvement of western banks in Russia remains comparatively small. Foreign banks in Russia accounted for under 10% of the Russian banking system’s total equity capital at end-2021, according to the CBR, down from 19.2% in 2012. The figure includes banks owned by holding companies influenced by Russian interests in jurisdictions such as Cyprus.

Only three foreign banks – Société Générale’s Rosbank, UniCredit and Raiffeisen International’s Raiffeisenbank – rank among the largest Russian banks. But there have been many smaller acquisitions by foreign banks keen to establish a presence in the market.

GE Money was an early entrant, acquiring DeltaBank, a Moscow-based Russian consumer bank in November 2004. However, in October 2013, GE Money Bank was sold to Sovcombank.

In 2007 KBC announced agreement to acquire at least 92.5% of Absolut Bank, an independent mortgage lender ranked 25th in Russia by assets, for €761 million. Under the terms of financial support received from state authorities, KBC undertook to sell its Russian operations before end-2013, which it achieved with the sale of the bank to Russian pension funds for €1.3 billion.

In November 2006, Nordea signed an agreement to purchase a 75% stake in JSB Orgresbank for $313.7 million. During May 2009, Nordea took ownership of 100% of Orgresbank.  Nordea announced that Orgresbank would change its name to Nordea and incorporate fully the Nordea brand from the start of September 2009.

During 2007, Santander acquired the Russian bank CB Extrobank for €48 million to help build Santander Consumer Finance’s presence in the Russian market. In December 2010 Santander sold its Russian operations to Orient Express Bank.

In March 2008, Barclays became the first major UK bank to acquire a Russian bank, announcing an agreement with Petropavlovsk Finance to acquire 100% of Expobank for $745 million. Headquartered in Moscow and focused principally on western Russia, Expobank began operations in 1994. Its distribution network comprised 32 branches, 12 cash desks and one of the largest ATM networks in Moscow. It had over 250,000 retail relationships, approximately 6,500 SME customers and 1,300 employees. In October 2011, Barclays sold the bank to Igor Kim of Kazakhstan.

Moskommertsbank (MKB) is one of the largest residential mortgage lenders, ranking in the top three in terms of disbursement and mortgage portfolio size in 2006. MKB is majority-owned by Kazkommertsbank of Kazakhstan.

In July 2008, Bank Hapoalim, the largest Israeli bank, agreed to purchase 78% of Moscow-based SDM Bank. As at end-2007, SDM Bank’s assets totalled $632 million. According to Bank Hapoalim, SDM Bank operates 450 ATMs and has extensive credit card activity.

Other retail banks include Garanti Bank of Turkey and the fast-growing Indian bank, ICICI Bank. Following receipt of a retail banking licence in Russia in July 2007, HSBC opened offices in two cities in addition to Moscow; however, it sold its retail banking interests, which cost a reported $200 million to develop, to Citibank in June 2011 for $10.7 million.

Banking Sector Background

The Russian market is dominated by four large state-owned banks and large private banks. and a myriad of small banks. The government has publicly stated that it would like to see the number of banks operating in the country cut to 300.

In the wake of the economic crisis, CBR increased capital requirements and revoked the licenses of more than 300 banks up to end-2015. In addition, CBR published a Core Russian Banks list of 10 banks and a Core Russian Payment services providers list of 51 institutions. In 2016, CBR continued the consolidation of the bank sector and revoked 110 bank licences.

A consolidation process of the bank sector is in progress. The process accelerated when the minimum capital requirement was set to RUR 300 million on January 1, 2015. Some significant events in the banking sector are listed below:

Developments in Russian Banking
2020
June	Sberbank and Yandex Money ended their partnership; Sberbank acquired Yandex.Checkout (rebranded as YooMoney)
2019
August	VOCBANK merged into PJSC MInBank.
June	Rosbank completed its merger with DeltaCredit Bank.
March	AVB Bank merged with TRUST Bank.
2018
January	Legal merger of VTB Bank and VTB24 Bank.
2017
May	Sberbank and Yandex partnered to create an e-commerce venture on the Yandex.Market e-commerce marketplace.
2016
November	MDM bank was renamed as B&N Bank (‘Binbank’).
2014
November	VTB Group says it may cancel its listing on the London Stock Exchange and relocate to the Shanghai Stock Exchange.
October	Contact announces an agreement with China UnionPay, enabling UnionPay cardholders to top up their cards via the Contact system at POS points in Russia and CIS countries.
October	Alfa-Bank acquires 88% of the distressed Baltiyskiy Bank.
August	Contact forms a holding company with Nomos subsidiary Rapida to merge their businesses, with 70% of the shares held by Rapida shareholders and 30% by Contact shareholders.
June	St. Petersburg-based Bank Rossiya becomes the first Russian bank to open in Crimea after the Russian annexation.
May	Otkritie Holdings announces plans to merge Otkritie Bank with Khanty-Mansiysk Bank.
2013
November	CBR revokes the licence of Master-Bank, ranked 75th in Russia, on grounds of “large-scale suspicious operations.”
October	GE Money Bank is sold to Sovcombank.
April	Otkritie Financial Corp announces revised structure for its interests in Nomos Bank and Otkritie Bank (see main text).
January	Rosneft announces plans for in-house bank, consolidating its existing interests into its 85%-owned Russian Regional Development Bank.
January	Sberbank buys 75% of Yandex.Money and announces JV.
2012
December	KBC agrees the sale of Absolut Bank to Russian pension funds.
September	Sberbank finalizes terms of POS finance joint venture with BNP Paribas/Cetelem.
August	PPF Group sells its 26.5% stake in Nomos-Bank to Otkritie Financial Corporation.
June	Sberbank buys 99.85% of Denizbank, Turkey’s sixth-largest private bank, for TL6.5 billion ($3.6 billion) from Dexia.
February	VTB lifts its stake in TransCreditBank to 77.9%.
2011
October	Barclays completes sale of Russian retail banking interests.
August	Raiffeisen buys retail banking assets of Swedbank.
July	Sberbank agrees to buy the eastern European network of Austria’s Volksbanken.
July	SocGen completes merger of its Russian banks under Rosbank, in which it holds 82.4%.
July	VTB is to purchase a shareholding in TransCreditBank from Russia Railways.
June	HSBC announces the sale of its retail interests to Citibank.
March	VTB says it plans to acquire a controlling shareholding in Bank of Moscow.
February	Barclays announces plans to sell Expobank, acquired for $745 million in 2008.
2010
December	Orient Express Bank agrees to buy Santander’s operations.
May	EBRD sells its 15% of Swedbank Russia to Swedbank.
May	Norway’s Spare Bank 1 buys 75% of St Petersburg-based NorthWestern Alliance Bank.
May	KBC of Belgium reported to be selling its 95%-owned Absolut Bank (which must be sold before end-2013).
February	SocGen announces plans to merge all its Russian financial companies – Rusfinance, Delta and BSGV – into a single company under Rosbank.
January	Peugeot Citroen’s PSA Finance Rus begins operations.
January	Promsvyazbank increases stake in Yarsotsbank to 61.91%.
2009
December	State-owned Vnesheconombank (VEB) announces plans to form a postal bank with Russian Post.
December	Intesa Sanpaolo completes merger with KMB Bank, trading as Banca Intesa; Intesa Sanpaolo owns 86.75% and EBRD 13.25%.
November	EBRD buys 11.75% of Promsvyazbank for RUR 4.6 billion.
May	Nordea increases stake in Orgresbank to 100%.
April	IPF announces closure of Russian pilot.
2008
December	MDM Bank and URSA Bank announce merger plans.
July	Bank Hapoalim signs agreement to acquire SDM Bank.
July	Erste Bank acquires 9.8% stake in Bank Center-Invest.
June	Bank of Cyprus agrees to acquire 80% of Uniastrum Bank.
April	PPF Group announces plans to increase its stake in Nomos-Bank from 17.69% to 29.9% (subsequently 26.5%).
March	BNP Paribas announces the start of its corporate, SME and retail operations in Moscow.
March	Barclays announces acquisition of 100% of Expobank for $745 million.
February	SocGen finalizes acquisition of majority stake in Rosbank.
2007
December	International Moscow Bank renamed UniCredit Bank.
December	IPF buys OOO Maritime Commercial Bank of Kaliningrad.
November	Merger of Raiffeisenbank and Impexbank legally concluded.
July	KBC receives regulatory approval from CBR to acquire Absolut Bank for €761 million.
July	London private equity firm Olivant takes 10% stake in Russian bank MDM, with IFC taking a 5% stake through a share issue.
June	BA-CA announces the acquisition of EBRD’s 9.97% interest in IMB, taking its holding to 100%.
May	KBC announces agreement to acquire 2.5% of Absolut Bank from IFC, taking its planned stake to 95%. IFC plans to retain a 5% shareholding.
May	PPF and Nomos-Bank announce strategic partnership In Russia.
May	Initial public offering and listing of VTB, Russia’s second largest bank, on the Russian and London stock exchanges.
2006
December	UniCredit subsidiary BA-CA finalizes the acquisition of a 19.77% shareholding of International Moscow Bank (IMB) from VTB Bank (France) SA. BA-CA also expects to acquire HVB’s 70.26% stake.
November	Nordea signs agreement to purchase a 75.01% stake in JSB Orgresbank in Russia for $313.7 million.
June	SocGen acquires a 10% stake in Rosbank, increasing this to 19.99% in September.
March	SocGen announces acquisition by Rusfinance of SKT Bank, a Moscow-based specialist in car financing.
February	Raiffeisen International, the CEE subsidiary of Austria’s RZB Banking Group, announces the acquisition of Impexbank, which will make it the largest foreign-owned banking group in Russia.
2005
November	BNP Paribas announces plans to enter the Russian retail banking market, including the provision of consumer credit through Cetelem.
April	Experian and Interfax Information Services Group announce a 50:50 joint venture to create the first credit bureau in Russia, the Experian-Interfax Bureau of Credit Histories.
March	Société Générale announces acquisition of 100% of Promek Bank, a subsidiary of the Russian SOK Group.
January	BNP Paribas announces that Cetelem has terminated its planned acquisition of 50% of the company that controls RSB.
2004
August	GE Consumer Finance announces acquisition of DeltaBank, a Moscow-based consumer bank.
August	Société Générale launches Russian consumer finance subsidiary Rusfinance with Barings Vostok Capital Partners.
July	Cetelem announces the acquisition of a 50% interest in the company which controls Russian Standard Bank (RSB), the leading consumer finance company in Russia.
Note:  IFC = International Finance Corporation, the private sector arm of the World Bank.
Source:  Yearbooks Research

Banking Sector Developments – Past Crises

In November 2013, CBR revoked the licence of Master-Bank, ranked 75th in Russia, on grounds of “large-scale suspicious operations.” CBR also said Master-Bank had a capital shortage of about RUR 2 billion and that Russia’s Deposit Insurance Agency will pay insured depositors up to RUR 30 billion.

Master-Bank, though relatively small (ranked 75th in Russia), developed an extensive ATM network of more than 3,000 units, including about 800 able to accept deposits in roubles and a range of foreign currencies. However, in November 2013, its banking licence was revoked by CBR, the central bank, on grounds of “large-scale suspicious operations”.

Previously, in July 2011, CBR withdrew AMT Bank’s licence, forcing the Deposit Insurance Agency to pay out its then-largest settlement ever to depositors – RUR 12 billion ($400 million).

During the closing months of 2008, the Russian banking sector came under intense pressure, accompanied by a significant depreciation of the rouble. According to Raiffeisen, the banks experienced withdrawal of around 6% of total retail deposits in October 2008 and a number had to be rescued by the government.

The main casualties were Svyaz-Bank and Globexbank, which were taken over by the state-owned development bank Vnesheconombank with funds from the central bank, which provided $2.5 billion for Svyaz-Bank and RUR 87 billion ($3.5 billion) for Globexbank. Aside from contagion risk, both banks are systemically important. Svyaz-Bank services accounts used to pay pensions by Federal Post of Russia, while Globexbank has focused on individual retail accounts.

During the financial crisis, the guaranteed amount of deposits was increased from RUR 200,000 to RUR 700,000. Historically, Sberbank was the only bank offering deposit protection guarantees, though these were extended to other authorised banks in early 2004.

A previous crisis of confidence occurred in mid-2004 when CBR revoked the banking licences of several banks, including Dialog-Option, Kredittrast and Sodbizesbank, though it had little longer-term impact. Guta Bank ran into difficulties and was forced to suspend withdrawals by depositors. Its VISA cards were blocked in July 2004 and Guta was taken over by Vneshtorgbank, aided by a deposit from CBR. By contrast, the financial crisis of August 1998 halted the development of the payment cards business for two years because of the severe loss of public confidence.

Before the 1998 financial crisis, the leading issuer was SBS-Agro, formed out of the merger of Stolichny and Agroprombank. It was the largest issuer of international cards (with Maestro and Electron programmes) and the principal owner of the STB-Card scheme. However, when the crisis broke, VISA and Mastercard blocked the BIN codes of several issuers and temporarily suspended some licences. Union Card and STB-Card were hit by the crisis, when STB-Card’s second largest member, the Moscow branch of Sberbank, stopped issuing STB cards, while Union Card lost Incombank, a founder member of the association.

In mid-2003, CBR reported 887 “credit institutions liquidated owing to revocation of licence,” for reasons including “violation of banking legislation and Bank of Russia regulations” as well as mergers or reorganisation.

Background Russian Mobile Payment Initiatives

Review – In the period from 2008 to 2016, various mobile SMS payments and contactless SIM SE NFC mobile initiatives were trialled. Although the technology piloted has been experienced as market proven, many of the mobile payment initiatives were phased-out due to slow user adoption. From 2016, mobile payment initiatives in Russia have entered a consolidation phase ending up with mobile banking apps and mobile HCE NFC payments on cards. For details and historic background regarding the phased-out mobile payment initiatives see below:

Mobile SIM SE NFC Payments – In December 2009, four leading Russian mobile network operators announced plans to collaborate on the introduction of NFC Test Zone services in Russia. VimpelCom, MegaFon, MTS (Mobile Telesystems) and Moskovskaya Sotovaya Svyaz (SkyLink Moscow) worked with Russia’s Infocommunication Union (ICU) trade association and Aeroexpress, operator of Moscow’s rail-air link, to launch an NFC ticketing trial in Russia. The pilot went live in November 2010. In 2015, the service is used in large Russian cities including Moscow, St Petersburg, Kazan, and Yekaterinburg.

In June 2010, Sberbank reportedly ran an NFC trial in Moscow together with national railway operator RZD and the Moscow Underground. Sberbank planned to issue NFC phones to 10,000 consumers for the trial.

2011 – In June 2011, mobile network operator VimpelCom, which runs the Beeline mobile network, partnered with Alfa Bank to launch the RURU payment services with NFC payments to be added later. RURU was to provide mobile commerce and ecommerce payments, P2P transfers and mobile remittances. RURU customers were able to use the system to pay for telecoms services, utilities, fees for loans and payments to the state, railway and air tickets, tickets to entertainment events, paid content on the internet and, later, for goods in shops. The service also included person-to-person funds transfers and remote money transfers. RURU customers nominated a default account which was automatically debited each time they made a purchase using the service. Transactions made via RURU could be charged to their Beeline account. Purchases could also be charged to VISA and Mastercard branded cards as well as to a WebMoney account.

In October 2011, mobile network operator MTS and oil company Lukoil introduced a service that let customers pre-set the amount of fuel they wished to buy on their NFC phone. Drivers then tapped their handset to a contactless reader built into the fuel pump to communicate how much fuel they wanted and made payment.

2012 – In March 2012, MTS Bank, mobile network operator MTS and Mastercard launched an NFC payments service. The service allowed MTS customers to make payments of up to RUR 1,000 with their mobile phone without entering a PIN and was available in two versions, allowing customers to choose to add a SIM+antenna solution to their existing phone or to upgrade to a Sony Xperia Sola phone with built-in NFC functionality.

2013 – In June 2013, Alfa Bank in partnership with Vimpelcom (now: VEON) and Mastercard launched its NFC mobile payment pilots in Russia and the Ukraine. To use the service, customers were required to download a mobile app and link their payment card to it. They were then free to pay at Mastercard PayPass terminals with the tap of their phone, with transactions deducted from the bank account linked to the app. Up to RUR 1,000 could be paid without PIN.

In July 2013, Moscow’s Department of Transportation said that it was planning to install NFC subway turnstiles for mobile payments in September 2013.

In September 2013, Electronics retailer Media Markt began testing ‘shopping walls’ at a Moscow subway station. The concept made use of both NFC and QR codes. Eighteen columns located across Vystavochnaya station on the Moscow Metro were decorated with posters designed to look like the shelves of a Media Markt store. The price tag on every product displayed contained an NFC tag and a QR-code. When tapping the NFC tag or scanning a QR-code, consumers were redirected to Media Markt’s mobile website where they could place an order for a product and choose whether they wish to pick their order up from the nearest store or have it delivered to their home.

VimpelCom, the Russian mobile network operator, announced to become VEON underscoring the ambition of its accelerated digital strategy with the launch of the VEON internet platform in all countries by the end of 2017, having successfully launched in Italy in Q4 2016. VEON planned a second listing on Euronext Amsterdam in Q2 2017 to broaden its European investor base on the back of an increasing free float.

Credit Bureaux

The launch of credit bureaux followed introduction of federal legislation for their operation in 2004.

The main credit bureaux in Russia are United Credit Bureau (formerly Experian-Interfax), NBKI – the National Bureau of Credit Histories – and Equifax Credit Services.

Credit records are accumulated at the Central Catalogue of Credit Histories under the ultimate supervision of CBR. During 2012, the number of credit history titles at CCCH increased by 33 million (up by 11% on the previous year) to 175 million.

Experian was an early entrant to the Russian market, forming a joint venture with Interfax in 2005. In December 2009, the joint venture was expanded to accommodate Sberbank, which has taken a 50% interest, with Experian and Interfax each retaining 25%. Since Sberbank data was included, the business has expanded rapidly, increasing by 60% in 2012 to an end-year total of 93 million credit histories.

The name was changed to United Credit Bureau with effect from October 2011; subsequently, Infocredit was acquired, with the purchase finalised early in 2012.

In July 2008, Equifax completed the acquisition of 28% of Global Payments Credit Services (GPCS), a joint venture credit information company in Russia owned by Global Payments Europe and Home Credit with a database of 20 million records on over 14 million individuals from more than 50 data providers. In its annual report for 2012, Equifax said it had increased its shareholding from 33% to 43% and intended to reach 50% ownership in the foreseeable future.

NBKI, formed in 2005, claims to be the largest Russia credit bureau, holding data from more than 1,350 Russian creditors as of August 2012. Shareholders are CRIF, TransUnion and more than 20 commercial banks, including VTB, Gazprombank, Alfa-Bank, UniCredit Bank and Citibank Russia.

Universal Electronic Card (UEC)

The UEC card was an identity E-card that was issued to Russian citizens starting from January 2013 to gradually replace the internal passport of Russia.

After a period of fluctuating fortunes, the UEC scheme was flavour of the month once more as the Russian authorities responded to the impact of western sanctions.

Sberbank several years ago linked with the regional banks AK Bars and Uralsib to launch and develop Universal Electronic Card (UEC) as a universal citizen e-ID card for access to government and municipal benefits and services, including state medical insurance and pension entitlements, driving licences, national insurance cards, car insurance and migrant ID cards, enabling payment for services where appropriate.

In July 2010, the Russian Duma (parliament) approved a new law, ‘On the Organisation of Public and Municipal Services,’ in which Sberbank was allotted a leading role. Sberbank said costs of establishing the UEC system would amount to RUR 150 billion ($5 billion) over five years, of which costs to the banks would be about RUR 40 billion ($1.3 billion). Following approval in 2010, initial issuance was scheduled for July 2012 but in February 2012, roll-out was delayed to January 2013.

By February 2013, the scope of the UEC scheme was scaled back for lack of funding. Though it was intended to apply to all of Russia’s 83 regions, central government said that Moscow would not make any funds available for scheme infrastructure or implementation.

Sberbank held 34% of the shares of UEC, with AK Bars and Uralsib holding 33% each, and began roll-out of its own UEC cards in August 2012.

At the St Petersburg economic forum in June 2011, UEC said that Mastercard would be involved in cooperation on the project. UEC cards would be chip-based and linked to a central database accessed by PIN entry; contactless functionality might also be included.

Commenting on the project in February 2011, Russian president Dmitry Medvedev said: “Everything must be done so that the card, which we have approved, is universal in nature, is a universal financial instrument, which can be used in Russia and abroad, and not some kind of homemade product that is not recognised in other countries.” However, in December 2016, the UEC scheme was terminated as focus shifted to making MIR a universal card and ID product.

Sbercard

Sberbank in the past promoted its proprietary, smart card-based Sbercard as a national interbank payments system. As at March 2007, the system encompassed 3.2 million cards, 22,000 POS/payment terminals, 7,500 ATMs and 30 participants in 65 regions of Russia.

At this time, Sbercard was explicitly designed to compete with Mastercard and VISA. As well as payment applications, the Sbercard system was designed to handle social benefits and entitlements, and to serve as a funds transfer system for retailers, salary schemes and oil companies. In mid-2006, Sbercard claimed that the system also comprised 150 regional processing centres and 11,200 retailers; its ambitious goal was to issue 50 million Sbercard cards by 2010.

Around 2008, Sberbank’s strategy changed, with the main focus moving towards issuing VISA and Mastercard cards. Only 10.5% of Sberbank’s portfolio of over 30 million bank cards at end-2008 were Sbercard, indicating that the number of Sbercards in issue had not changed significantly during recent years.

Sbercard was initially launched in 1994, using a chip-based technology platform from BGS Smartcard Systems of Vienna. In 1997, the Sberbank board resolved to introduce the system in all regions of Russia. In June 2005, Sberbank said it would open the system to other Russian banks, with the ambition of becoming the nationwide interbank payment system in Russia (see also Kazakhstan and Uzbekistan profiles).

In place of multiple functionalities centred on the proprietary Sbercard system, Sberbank went down the route of issuing payment cards with VISA and Mastercard and participating in Universal Electronic Card (UEC) as a universal citizen e-ID card for access to government and municipal benefits and services, including state medical insurance and pension entitlements.

Background Card Fraud

As many card transactions in Russia are cash withdrawals, criminals have tended to target ATMs. It is reported that there is less fraud at POS terminals, since merchants often request photographic identification such as passports.

Figures from CBR indicate that the fraud level in Russia increased from €12.8 million in 2006 to over €90 million in 2012. In terms of how fraud is committed, Sberbank has highlighted skimming at ATMs as a significant problem, with three times as many incidents recorded in 2012 as compared to 2011. Hacking and phishing attacks are said to be increasing, with banks, payment systems and airlines under attack.

According to a Fair Isaac Corporation report, in 2014, Russia continued its high growth trend for another year, with fraud losses growing 24% over 2013, which in turn had recorded 28% growth vs. 2012. The actual growth amount in 2014 was 2.5 times the number of losses recorded back in 2006, and the growth in counterfeit losses was the highest at 29%, which is different to more mature markets for plastic cards, such as the UK and Germany. This growth is not surprising, given that Russia’s card spending grew by 36% in terms of monetary value from 2013 to 2014, and by 16% in terms of transactions.

Counterfeit made up nearly 40% of the total losses and reflected the opportunity afforded the criminals in a country where EMV transactions represent only around half of all “face-to-face” transactions, compared to 96% in Western Europe. However, growth in EMV transactions did grow by 8% in 2014, so there will be a change to a mix of fraud similar to Western Europe as Russia closes the door on mag-stripe counterfeit fraud.

CNP fraud was at just 3% of losses, which won’t rise until the criminals are forced to change their attack. UK and Germany have CNP at 70% of the total fraud mix, and that’s the trend that is expected as Russia completes its rollout of EMV in the region.

Given that criminals prefer card-present fraud at ATMs, it’s no surprise that lost and stolen was the second highest area of loss, with 33% of the total losses. Lost and stolen is expected to decrease as EMV moves to cover 80% of transactions, because in Russia the PIN will be required as well as the stolen card. It will no longer be viable to steal the wallet or handbag without first observing the PIN being entered at an ATM or POS device.

Theft of cards from the postal system was around 11% of the losses, and again, this is expected to decrease as EMV adoption increases, because once all of the PINs have been issued to customers then the card is of no use on its own, and as a result is no longer as much of a target.

Any growth market attracts ID theft as criminals try to exploit marketing and the origination process to get a good card and PIN with which to commit fraud. ID theft was around 15% of the total losses in Russia, three times the percentage seen in a mature market such as the UK.

Background CONTACT System

Established in 1999 by Russlavbank, which served as system operator until August 2014, Contact was one of the pioneers of the Russian and regional market for remittances. In August 2014, Contact and Rapida formed a holding company to merge their businesses, with 70% of the shares held by Rapida shareholders and 30% by Contact shareholders. Rapida is a subsidiary of Nomos Bank, the corporate banking arm of the Otkritie Holding financial group. Russlavbank will continue to serve as a processing centre for the Contact system.

Contact and Rapida will retain their individual brands and business focus. Contact will continue to develop its money transfer business, while Rapida will specialize in payments to providers and banks. Annual turnover of the combined businesses is forecast to reach RUR 800 billion, and the joint POS network will amount to more than 500,000 units.

Before the formation of the holding company, Contact payments were being made to 1,500 legal entities, including commercial banks, trading companies, insurance and travel companies and their agents, internet service providers, and telecom operators on behalf of customers worldwide. Since 2013, Contact has been classified by CBR as one of two Russian-based socially important payment systems along with Zolotaya Korona.

In October 2014, Contact announced an agreement with China UnionPay, enabling UnionPay cardholders to top up their cards via the Contact system at POS points in Russia and CIS countries. Transfers, of amounts up to $3,000, are made in dollars and converted into yuan at the prevailing exchange rate. Plans are being developed to extend the service to cards issued by Russian banks.

In April 2014, the Russian newspaper ‘Kommersant’ published allegations that 15 banks had suspended cooperation with Contact following the launch of criminal proceedings against a senior Russlavbank executive. Contact’s response can be viewed at https://www.contact-sys.com/en/news/newsletter.

Table Data

Market Overview
Payment Organisation	National Payments Council Association. National Payment Card System (NCPS).
Domestic Card Brand	MIR cards, also co-badged Mastercard, VISA, JCB, or UnionPay. Zolotaya Korona “Golden Crown” cards
Market Structure	In 2016, the Russian banks started the domestic MIR card payments system, designed to take on VISA and Mastercard. Sberbank, the Savings Bank of the Russian Federation, dominates the retail banking market, followed by VTB Bank. Mobile wallet apps are offered by all leading Russian banks. The state, CBR and Russian banks setup a FinTech Association for the development and introduction of digital technology solutions. Ongoing and significant consolidation in terms of the number of banks. Increasing levels of state ownership through consolidation.
Notable Market Trends	Contactless rollout: MIR cards, POS terminals, HCE NFC pilots, money transfer card-to-card at ATMs, ‘Huawei Pay, Instant Payments, and Biometric payments. Following the COVID-19 pandemic, B2C e-commerce value grew significantly to reach RUR 5.7 trillion in 2022. The conflict with Ukraine has led to several Western banks and payment schemes either suspending operations or exiting Russia completely.
Major Card Issuers	Sberbank, VTB Bank, Russian Standard Bank, Zolotaya Korona, Alfa Bank.
Major Card Acquirers	Sberbank, VTB Bank, Gazprombank, Russian Standard Bank, UCS, Promsvyazbank, Alfa Bank.
Major Card Processors	United Card Service, MultiKarta (VTB Group), RuCard.

Key Statistics 2023
Population	146.15 million, 3.07 payment cards per capita (active cards 1.73)
Cards	Debit: 394.73 million Credit: 54.55 million Prepaid: 296.78 million Total cards: 746.06 million, thereof bank cards 449.28 million
Card Transactions	Payments: 73.85 billion, value: RUR 136.05 trillion ($1,607.07 billion) Withdrawals: 1.99 billion; value: RUR 35.08 trillion ($414.4 billion) Total: 75.84 billion; value: RUR 171.13 trillion ($2,021.5 billion)
POS Terminals	4,051,733
POS Payments	61.37 billion, value: RUR 56.38 trillion ($666.0 billion)
ATMs	115,059
ATM Withdrawals	1.99 billion, value: RUR 35.08 trillion ($414.38 billion)
Digital A2A Payments	Instant Payments: 3.04 billion; value: RUB 14.35 trillion

1 - Analysis of Credit Institutions in Russia
Operating Credit Institutions	2019	2020	2021	2022	2023
State-controlled banks	22	22	22	22	22
Foreign-controlled banks	50	50	50	50	50
Large and medium private banks	170	167	172	170	170
Banks with a basic licence	136	123	112	106	106
Banks under resolution	24	15	13	12	12
Total banks	402	377	369	326	324
- thereof credit organisations issuing cards	297	253	246	235	229
- thereof credit organisations acquiring payment cards	277	231	220	215	214
Non-bank credit institutions	40	40	37	35	37
Total credit institutions	442	417	406	361	361
Number of branches	618	530	471	453	421
Note: some CBR data for 2021 and 2022 was not published. Therefore figures from various sources are indicative only.
Source: Central Bank of Russia.

2 - Main Banks in Russia end-2023
Bank	Ownership	Assets ($bn)	Market Share (%)
Sberbank	State (CBR): 50%+1 voting share, investors	775.4	39.16%
VTB Bank	State: 60.93%, investors	435.6	22.00%
Gazprombank	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others	231.7	11.70%
Alfa Bank Group	State-owned: 92.2%	80.1	4.04%
Russian Agricultural Bank (RusAg)	State: 100%	63.2	3.19%
Vnesheconombank (VEB)	State: 100%	48.3	2.44%
Promsvyazbank (PSB)	State via Central Bank of Russia, nationalised by fiat 2019	41.0	2.07%
Raiffeisenbank	Raiffeisen RBI Group (A)	47.6	2.41%
Rosbank	Société Générale (F): 99.95%	31.1	1.57%
UniCredit Bank	UniCredit Group (I):100%	17.8	0.90%
Russian Standard Bank (RSB)	Russian Standard Corp.: 99.92%	5.0	0.25%
other banks		708.6	35.78%
Total		1,980.3	100.00%
Market share of systemically important top-20 banks (12)		1,524.8	77.00%
Note: assets are as at 1 Dec. 2021 apart from VEB (end-Q1 2021), PSB (end-2020) and RSB (end-2020); total assets approximately $1,615.8bn at year-end; exchange rate of $1: RUR 73.65
Note: VTB purchased Okritie FC Bank by end-2021.
Source: CBR, Yearbook research.

3 - Sberbank Remote Channel Clients
(millions)	2019	2020	2021	2022	2023	GR 22/23
Number active remote channel clients	69.9	69.9	69.9	74.8	108.5	45.05%
of which:
App average monthly users (m)	54.7	73.0	76.1	78.6	82.6	5.09%
App average daily users (m)	24.7	32.4	38.8	40.9	43.3	5.87%
Active corporate digital users (m)	2.2	2.3	2.3	2.3	2.3	0.00%
Note: the above figures are for unique active clients who are able to use various remote channels.
Source: Sberbank.

4 - Cashless Payment Transactions in Russia
(Millions)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Payments on cards	39,217.0	48,028.5	62,414.4	69,298.0	75,845.5	9.4%	21.1%
E-money transactions	2,420.2	2,914.6	3,276.5	3,417.9	4,154.4	21.6%	17.0%
Cheques issued	-	-	-	-	-	-	-
Credit transfers	2,368.7	2,651.7	3,621.9	5,744.2	9,389.5	63.5%	35.5%
Direct debits	199.4	225.6	223.5	223.2	205.3	-8.0%	7.4%
Other payment instruments	1,762.0	1,863.6	2,079.3	2,665.6	3,313.2	24.3%	15.6%
Total	45,967.2	55,684.1	71,615.6	81,348.9	92,908.0	14.2%	21.7%
Total card payments per capita	267.2	327.9	426.2	473.2	519.0	9.7%	21.2%
E-money transactions per capita	16.5	19.9	22.4	23.3	28.4	21.8%	17.1%
Total cheques issued per capita	-	-	-	-	-	-	-
Total credit transfers per capita	16.1	18.1	24.7	39.2	64.2	63.8%	35.6%
Total direct debits per capita	12.0	12.7	14.2	18.2	22.7	24.6%	15.7%
Total cashless payments per capita	313.2	380.2	489.0	555.4	635.7	14.5%	21.8%
Note: credit transfer and e-money figures have been restated.
Note: BIS does not give an explanation of "other payment instruments".
Source: CBR, BIS.

5 - Average Exchange Rate
	2019	2020	2021	2022	2023
1 EUR in RUR	72.4553	82.7248	87.1527	70.8605	91.5924
1 USD in RUR	64.7276	71.9422	73.6457	67.4562	84.6566
Source: ECB (€), CBR ($).

6 - Leading Card Issuers in Russia
Domestic Issuers	Issued Card Brands	Owned by
Sberbank	Mastercard, VISA; Electron; MIR	State (CBR): 50%+1 voting share, investors
VTB Bank	Mastercard, VISA; MIR	State: 60.93%, investors
Alfa Bank	Mastercard, VISA; MIR	five private investors (RUS): 86.2%,Charity: 3.8% UniCredit (I): 9.9%
Russian Standard Bank (RSB)	Mastercard, VISA, American Express, Diners, UnionPay; VISA Debit; MIR, Daricard	Russian Standard Corp.: 99.92%
Promsvyazbank (PSB)	Mastercard, VISA; MIR	State Rescue Scheme Implemented Feb 2019
Gazprombank (GPB)	Mastercard, VISA, JCB, UnionPay; Electron; MIR	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others
Russian Agricultural Bank	Mastercard, VISA, JCB, UnionPay; MIR	State: 100%
B&N Bank	Mastercard, VISA; MIR; Zolotaya Korona	State Rescue Scheme Implemented late 2017
Uralsib Bank	Mastercard, VISA, American Express	2017: Vladimir Kogan: 81.81%, other individuals (RUS)
Tinkoff Bank (TCS)	Mastercard	private individual: 54.77%, investors: 14.82%, free float: 30.41%
UniCredit Bank	Mastercard, VISA; MIR	UniCredit Group (I): 100%
Rosbank	Mastercard, VISA; Electron; MIR	Société Générale (F): 99.95%
Raiffeisenbank	Mastercard, VISA; MIR	Raiffeisen RBI Group (A)
Home Credit Bank	Mastercard, VISA; MIR	Home Credit Group (NL)
other banks	Mastercard, VISA; MIR	other bank owners
Note: the Russian banks use the VISA and Mastercard brands for debit cards, delayed debit card and credit cards, respectively.
Note: in addition Russian banks may issue domestic cards branded Zolotaya Korona, UEC, or local mono-line payroll cards.
Note: Russian Standard Bank is the exclusive issuer of AmEx Centurion since 2005.
Source: PCM research

7 - Leading Acquirers in Russia
Domestic Acquirers	Acceptance Brands offered	Owned by
Sberbank	Mastercard, VISA, JCB; Electron; MIR	State (CBR): 50%+1 voting share, investors
VTB Bank	Mastercard, VISA, JCB; Electron; MIR, Alipay, UnionPay	State: 60.93%, investors
Gazprombank (GPB)	Mastercard, VISA, JCB; Electron; MIR	Gazprom: 49.89%, Gazfond: 40.88%, VEB: 8.02%, others
Russian Standard Bank (RSB)	Mastercard, VISA, American Express, Diners, Discover, JCB, UnionPay; Maestro, Electron; MIR	Russian Standard Corp.: 99.92%
United Card Service (UCS)	Mastercard, VISA, JCB, UnionPay; Electron; MIR	Global Payments Europe (UK)
Alfa Bank	Mastercard, VISA; Electron; MIR	five private investors (RUS): 86.2%,Charity 3.8% UniCredit (I): 9.9%
B&N Bank	Mastercard, VISA; Electron; MIR	State Rescue Scheme Implemented late 2017
Promsvyazbank (PSB)	Mastercard, VISA; Electron; MIR	State Rescue Scheme Implemented Feb 2019
Russian Agricultural Bank	Mastercard, VISA, JCB; Electron; MIR	State: 100%
other acquirer banks	Mastercard, VISA; Electron; MIR	other bank owners
Note: in addition, Russian acquirers accept Zolotaya Korona cards and local debit cards at their respective ATMs and POS terminals.
Note: Uralsib also acquires American Express
Source: PCM research

8 - Leading Russian Acquirers - Key Figures 2023
Domestic Acquirers	Acquired Volumes		Merchants serviced		thereof online merchants serviced
	payments (m)	value ($bn)	outlets	POS terminals	payments (m)	value ($bn)	in % of total of acquired value
Sberbank	3,766.9	99.8	1,486,368	2,352,325	3,821.6	59.9	60.07%
VTB Bank	1,308.3	17.8	200,482	408,319	601.7	10.4	58.46%
Gazprombank	500.0	4.7	37,382	47,755	51.0	2.4	51.06%
Tinkoff Bank	200.0	3.4	78,187	51,380	64.0	2.1	61.76%
Russian Standard Bank	126.3	2.4	45,952	58,562	85.2	1.8	75.00%
Promsvyazbank	118.2	1.9	29,630	55,588	62.8	1.3	68.42%
Note: acquired payments by number and value are by VISA and Mastercard cards. Online payments include all card brands.
Note: POS terminals may include double counting of POS terminals.
Source: annual reports, PCM research.

9 - ATMs in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cash-dispensing ATMs	131,908	124,687	120,745	114,343	115,059	0.63%	-2.31%
Ø Number of TXs per ATM per month	1,924.2	1,663.1	1,612.6	1,559.0	1,446.5	-7.21%	-6.59%
Number of ATM cash withdrawals (m)	3,045.9	2,488.4	2,336.6	2,139.1	1,997.2	-6.63%	-8.75%
- on domestic cards (m)	3,033.5	2,480.7	2,329.6	2,139.1	1,997.2	-6.63%	-8.67%
- on foreign cards (m)	12.4	7.6	7.0	0.0	0.0	NA	NA
Value of ATM cash withdrawals (RUR bn)	27,500.2	27,054.7	29,672.9	31,110.6	35,080.2	12.76%	5.68%
- on domestic cards (RUR bn)	27,368.5	26,958.6	29,579.0	31,110.6	35,080.2	12.76%	5.79%
- on foreign cards (RUR bn)	131.7	96.2	93.9	0.0	0.0	NA	NA
ATV per ATM withdrawal (RUR)	9,028.65	10,872.39	12,699.43	14,543.57	17,564.41	20.77%	15.82%
# ATM terminals per 1m capita - Russia	898.8	851.3	824.4	780.7	787.3	0.84%	-2.22%
# ATM terminals per 1m capita - EA10 total	728.9	713.7	698.7	679.4	706.3	3.96%	-0.17%
Source: BIS, CBR.

10 - POS Terminals in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
EFTPOS terminals	2,913,026	3,598,729	3,546,869	3,809,513	4,051,733	6.4%	9.4%
Ø Number of TXs per POS per month	780.2	723.2	1141.5	1189.1	1262.2	6.1%	13.4%
Number of POS payments (m)	27,273.7	31,232.1	48,583.9	54,360.9	61,368.4	12.9%	24.1%
- on domestic cards (m)	27,151.6	38,812.3	48,446.4	54,360.9	61,368.4	12.9%	24.2%
- on foreign cards (m)	122.1	133.5	137.6	0.0	0.0	NA	NA
Value of POS payments (RUR bn)	18,488.3	20,727.4	43,773.5	49,610.9	56,377.5	13.6%	30.1%
- on domestic cards (RUR bn)	18,163.9	32,429.6	43,483.2	49,610.9	56,377.5	13.6%	30.7%
- on foreign cards (RUR bn)	324.3	276.4	290.3	0.0	0.0	NA	NA
ATV per POS payment (RUR)	677.88	663.66	900.99	912.62	918.67	0.7%	4.9%
# POS terminals per 1m capita - Russia	19,848.2	24,571.4	24,217.3	26,010.6	27,723.0	6.6%	9.5%
# POS terminals per 1m capita - EA10 total	15,041.9	17,950.0	19,042.0	21,172.0	23,259.9	9.9%	12.5%
Source: CBR, BIS.

11 - Internet Use in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Internet use (individuals)	83%	85%	86%	87%	87%	0.00%	1.47%
Online buyers (individuals)	79%	81%	82%	83%	83%	0.00%	3.47%
Mobile subscribers per 100 inhabitants	164.4%	163.6%	169.0%	168.7%	168.7%	0.00%	1.39%
Number of remote access accounts (m)	250.76	278.75	314.07	350.02	376.74	7.64%	10.09%
- of which with internet access	96.4%	96.2%	96.1%	96.1%	96.1%	0.08%	0.62%
- of which with access by mobile devices	73.0%	72.5%	73.4%	74.7%	72.9%	-2.30%	-0.95%
B2C e-commerce revenue (€bn)	23.40	32.64	47.04	80.44	98.26	22.15%	41.21%
Annual B2C eCommerce growth rate/year	33.7%	39.5%	44.1%	71.0%	22.2%	-	-
Total B2C e-commerce value per capita	€159.44	€222.86	€321.18	€549.23	€672.32	22.41%	41.34%
Total B2C e-commerce value per online buyer	€201.82	€275.14	€391.68	€661.72	€810.02	22.41%	36.61%
Note: remote access accounts, opened by individuals with credit institutions, are used for online payments and other cashless payments.
Source: CBR, Eurostat, ITU, PCM research.

12 - Bank Cards Issued in Russia
(000s)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a cash function	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
Card with a payment function	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
- Cards with a debit function	248,648.0	266,479.4	294,267.0	349,207.1	394,729.8	13.04%	10.69%
- Cards with a credit function	37,183.9	39,143.4	40,436.7	47,428.6	54,552.3	15.02%	9.23%
Cards with an e-money function	257,117.4	356,262.3	364,040.9	284,507.3	296,781.8	4.31%	9.71%
Total cards	542,949.3	661,885.2	698,744.7	681,143.0	746,063.9	9.53%	10.19%
Total cards per capita - Russia	3.70	4.52	4.77	4.65	5.10	9.76%	10.29%
Payment cards per capita - Russia	1.95	2.09	2.29	2.71	3.07	13.51%	10.61%
Payment cards per capita - EA10 total	1.50	1.65	1.83	2.09	2.42	15.79%	11.57%
Note: e-money card numbers have been restated and include all kinds of virtual e-money (virtual cards, e-wallets etc.)
Note: debit card figures include delayed debit cards.
Source: CBR, BIS.

13 - Active Bank Cards in Russia
(000s)	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards issued	285,832	305,623	334,704	396,636	449,282	13.27%	10.51%
Cards in use	196,920	209,459	231,461	252,695	270,083	6.88%	8.55%
Active cards in %	68.9%	68.5%	69.2%	63.7%	60.1%	-5.64%	-1.78%
Cash withdrawals value (RURm)	27,241.78	26,791.68	28,010.72	29,596.54	33,309.64	12.55%	4.60%
Card payments value (RURm)	26,253.04	31,193.37	41,367.07	46,780.76	54,389.29	16.26%	20.99%
Other transactions (RURm)	35,612.57	44,807.48	59,756.04	73,306.89	79,264.02	8.13%	23.69%
Total transactions value (RURm)	89,107.38	102,792.53	129,133.83	149,684.20	166,962.94	11.54%	17.37%
Cash withdrawals value in %	30.6%	26.1%	21.7%	19.8%	20.0%	0.90%	-10.88%
Active payment cards per capita	1.34	1.43	1.58	1.73	1.85	7.11%	8.65%
Note: active cards in use are those used in transactions at least once during a quarter; figures from 2013 do not include e-money cards.
Note: figures are for active bank-issued consumer cards and transactions within Russia and abroad.
Note: other transactions include money transfers on bank cards to other bank accounts, e.g. charitable contributions, money transfers at ATMs, etc.
Source: Central Bank of Russia (CBR).

14 - Business Cards in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Business cards issued (000s)	4,007	4,568	5,597	6,974	6,904	-1.01%	17.80%
Business cards in use (000s)	1,951	2,209	2,565	2,726	2,874	5.45%	15.06%
Value of transactions (RUR bn)	3,477.7	3,904.8	5,732.5	5,611.4	4,729.9	-15.71%	10.26%
- cash withdrawals	1,604.7	1,624.7	1,802.7	1,899.6	1,924.1	1.29%	4.89%
- payments	1,852.6	2,180.7	3,710.0	3,400.8	2,398.2	-29.48%	11.66%
- other transactions	20.4	99.4	219.7	311.0	407.6	31.05%	146.96%
Note: other transactions include bank card transactions not related to payments for goods, works and services (eg. card to card and card to bank account fund transfers, e-money uploads, fund transfers for charity purposes etc.)
Source: Central Bank of Russia (CBR).

15 - Cash Withdrawals with Russian Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a cash function (000s)	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.27%	10.51%
Cash withdrawals per card per year	10.7	8.2	7.0	5.4	4.4	-17.57%	-17.46%
Number of withdrawals on cards (m)	3,054.2	2,494.1	2,343.6	2,139.1	1,997.2	-6.63%	-8.78%
- thereof withdrawals domestic (m)	3,033.5	2,480.7	2,329.6	2,139.1	1,997.2	-6.63%	-8.67%
- thereof withdrawals abroad (m)	20.7	13.4	14.1	0.0	0.0	NA	NA
Withdrawals value on cards (RURbn)	28,923.2	28,296.6	29,813.5	31,110.6	35,080.2	12.76%	4.46%
- thereof values domestic (RURbn)	28,656.5	28,073.8	29,579.0	31,110.6	35,080.2	12.76%	4.65%
- thereof values abroad (RURbn)	266.7	222.8	234.5	0.0	0.0	NA	NA
ATV per cash withdrawal (domestic) (RUR)	9,446.65	11,316.68	12,697.19	14,543.57	17,564.41	20.77%	14.59%
Total cash withdrawals per capita	20.8	17.0	16.0	14.6	13.7	-6.44%	-8.70%
Total withdrawals value per capita (RUR)	197,071.5	193,203.6	203,560.4	212,416.8	240,027.5	13.00%	4.56%
Note: cards with a cash function numbers have been restated.
Note: cash withdrawals include some at bank branches without the use of an ATM.
Source: CBR, BIS.

16 - Payments with Russian Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Cards with a payment function (000s)	285,831.9	305,622.8	334,703.7	396,635.7	449,282.1	13.3%	10.5%
Ø payments per card per year	137.2	157.1	179.5	169.3	164.4	-2.9%	9.0%
Ø payment value (RUR) per card per year	222,993.4	256,135.8	309,106.2	310,685.1	302,814.4	-2.5%	10.7%
Payments on Russian cards (m)	39,217.0	48,028.5	60,084.9	67,158.9	73,848.3	10.0%	20.4%
- thereof payments abroad (m)	606.2	611.2	939.2	0.0	0.0	NA	NA
- with debit cards (m)	36,371.3	45,169.2	57,208.1	64,247.6	70,137.1	9.2%	21.0%
- with credit cards (m)	2,845.7	2,859.3	2,876.8	2,911.3	3,711.2	27.5%	12.2%
Value of payments (RURbn)	63,738.6	78,280.9	103,459.0	123,228.8	136,049.1	10.4%	22.3%
- thereof payments abroad (RURbn)	1,380.6	944.4	1,593.9	0.0	0.0	NA	NA
- with debit cards (RUBbn)	60,583.4	75,067.4	100,158.0	119,806.6	131,481.0	9.7%	22.7%
- with credit cards (RUBbn)	3,155.2	3,213.6	3,301.0	3,422.2	4,568.0	33.5%	13.6%
ATV per card payment (RUR)	1,625.28	1,629.88	1,721.88	1,834.88	1,842.28	0.4%	1.5%
Total card payments per capita	267.2	327.9	410.2	458.5	505.3	10.2%	20.6%
Total card value (RUR) per capita	434,290.3	534,486.9	706,397.7	841,381.9	930,881.6	10.6%	22.4%
Note: payments on Russian cards include utility bill payments on cards at bank branches, but exclude cash withdrawals.
Note: purchases on Russian e-money cards are not included in this table (see e-money use).
Source: CBR, BIS.

17 - Card Use Per Capita in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Debit card payments per capita	247.8	308.4	390.6	438.7	479.9	9.40%	21.11%
Debit card value per capita	$6,377.4	$7,124.4	$9,285.8	$12,126.6	$10,626.8	-12.37%	15.58%
Credit card payments per capita	19.4	19.5	19.6	19.9	25.4	27.74%	12.31%
Credit card value per capita	$332.1	$305.0	$306.0	$346.4	$369.2	6.59%	6.98%
Total card payments per capita	267.2	327.9	410.2	458.5	505.3	10.19%	20.56%
Total card value per capita	$6,709.5	$7,429.4	$9,591.8	$12,473.0	$10,996.0	-11.84%	15.21%
Source: CBR, BIS.

18 - Payments with Russian Debit Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Debit cards (000s)	248,648.0	266,479.4	294,267.0	349,207.1	394,729.8	13.04%	10.69%
Ø payments per debit card per year	146.3	169.5	194.4	184.0	177.7	-3.42%	9.31%
Ø payments value (RUR) per debit card per year	243,651.3	281,700.4	340,364.3	343,081.8	333,091.2	-2.91%	10.83%
Payments (m)	36,371.3	45,169.2	57,208.1	64,247.6	70,137.1	9.17%	21.00%
Value of payments (RURbn)	60,583.4	75,067.4	100,158.0	119,806.6	131,481.0	9.74%	22.68%
ATV per debit card payment (RUR)	1,665.69	1,661.91	1,750.77	1,864.76	1,874.63	0.53%	1.39%
Note: debit card figures include delayed debit card data; payments include payments to retailers and in bank kiosks.
Source: CBR, BIS.

19 - Payments with Russian Credit Cards
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Credit cards (000s)	37,183.9	39,143.4	40,436.7	47,428.6	54,552.3	15.02%	9.23%
Ø payments per credit card per year	76.5	73.0	71.1	61.4	68.0	10.83%	2.73%
Ø payments value (RUR) per credit card per year	84,854.3	82,097.7	81,633.7	72,154.7	83,737.1	16.05%	3.96%
Payments (m)	2,845.7	2,859.3	2,876.8	2,911.3	3,711.2	27.47%	12.21%
Value of payments (RURbn)	3,155.2	3,213.6	3,301.0	3,422.2	4,568.0	33.48%	13.55%
ATV per credit card payment (RUR)	1,108.78	1,123.90	1,147.46	1,175.47	1,230.89	4.71%	1.20%
Source: CBR, BIS.

20 - Top-10 in the Russian Credit Card Market
Bank	Portfolio (RURbn)				Market Share in Credit Card Market
	in Q4 2017	in Q4 2018	in Q4 2019	in Q4 2020	end-2017	end-2018	end-2019	end-2020
Sberbank	510.6	588.6	700.9	703.4	45.5%	44.9%	43.9%	43.4%
Tinkoff Bank (TCS)	130.2	154.4	212.7	227.3	11.6%	11.8%	13.3%	14.0%
Alfa-Bank	93.6	145.1	171.7	182.7	8.3%	11.1%	10.8%	11.3%
VTB Bank	92.6	94.6	107.6	100.1	8.3%	7.2%	6.7%	6.2%
Russian Standard Bank	43.8	55.6	77.5	72.1	3.9%	4.2%	4.9%	4.4%
Orient Express Bank	46.2	56.7	61.2	57.4	4.1%	4.3%	3.8%	3.5%
Sovcombank	6.6	18.7	23.4	81.7	0.6%	1.4%	2.6%	5.0%
OTP Bank	21.2	21.8	22.6	20.7	1.9%	1.7%	1.4%	1.3%
Raiffeisenbank	15.9	17.9	19.7	na	1.4%	1.4%	1.2%	na
Otkritie Bank	21.5	16.5	na	na	1.9%	1.3%	na	na
other banks	161.0	159.6	197.7	175.6	14.4%	12.2%	12.4%	10.8%
Total credit card market	1,121.7	1,313.0	1,595.0	1,621.0	100.0%	100.0%	100.0%	100.0%
Source: Tinkoff Bank credit card market report 2020.

21 - E-money Use in Russia
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
E-money institutions (EMIs)	86	80	69	68	60	-11.76%	-8.39%
Total e-money purchases (m)	2,420.2	2,914.6	3,276.5	3,417.9	4,154.4	21.55%	16.95%
Total e-money purchases value (RUR bn)	1,438.9	1,494.9	2,671.9	3,041.5	4,333.4	42.48%	28.99%
ATV per e-money purchase (RUR)	594.55	512.89	815.47	889.88	1,043.08	17.22%	10.29%
Number of e-money accounts (000s)	257,117.4	356,262.3	364,040.9	284,507.3	296,781.8	4.31%	9.71%
Number of e-money operations (m)	2,789.3	3,118.7	3,276.5	3,417.9	4,154.4	21.55%	13.82%
Value of e-money operations (RUR bn)	1,967.6	1,829.4	2,671.9	3,041.5	4,333.4	42.48%	20.93%
ATV per e-money operation (RUR)	705.42	586.57	815.47	889.88	1,043.08	17.22%	6.25%
Total e-money operations per capita	19.0	21.3	22.4	23.3	28.4	21.81%	13.92%
Total e-money operations value (RUR) per capita	13,406.8	12,490.4	18,243.0	20,766.7	29,650.4	42.78%	21.05%
Note: e-money operations include all personalised and non-personalised e-money transactions, including e-money purchases on e-money cards.
Source: CBR, BIS.

22 - Sberbank Key Figures
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Active retail clients in Russia (m)	96.2	98.9	103.0	107.0	108.5	1.4%	3.2%
Cards issued (m)	131.0	138.1	146.2	154.8	155.0	0.1%	4.6%
- of which debit cards	115.0	123.1	132.2	137.0	135.0	-1.5%	4.5%
- of which credit cards	16.0	15.0	14.0	17.8	20.0	12.4%	5.6%
Number of ATMs and self-service terminals (000s)	76.9	70.4	67.7	65.6	65.6	0.0%	-3.5%
POS terminals at Russian merchants (000s)	2,201.0	2,187.0	2,377.5	2,367.0	2,250.0	-4.9%	4.6%
Note: Sberbank key figures are for Russia, excluding subsidiary banks.
Note: cards issued figures from 2018 onwards are for active cards only.
Note: on the use of branch devices for cash withdrawals and/or card payments, all Sberbank self-service terminals are deemed to be ATMs.
Source: Sberbank.

23 - Russian Remittances
	2019	2020	2021	2022	2023	GR 22/23	CAGR 5Y
Remittances from Russia ($m)	7,541	7,400	8,662	632	632	0.00%	-41.82%
- to non-Eurasian countries	1,445	1,207	1,085	379	379	0.00%	-28.45%
- to Eurasian countries	6,096	6,193	7,577	253	253	0.00%	-49.18%
Remittances to Russia ($m)	3,329	3,119	3,237	1,363	1,363	0.00%	-12.47%
- from non-Eurasian countries	1,832	1,719	1,866	184	184	0.00%	-28.48%
- from Eurasian countries	1,497	1,400	1,370	1,179	1,179	0.00%	-6.73%
Balance ($m)	-4,212	-4,281	-5,425	-731	-731	0.00%	-36.04%
- non-Eurasian countries	387	512	781	196	196	0.00%	-171.66%
- Eurasian countries	-4,599	-4,793	-6,206	-926	-926	0.00%	-30.70%
Average remittance value ($):
- from Russia	407	273	273	383	383	0.00%	-2.60%
- to non-Eurasian countries	749	520	547	414	414	0.00%	-15.66%
- to Eurasian countries	368	250	255	345	345	0.00%	-1.91%
- to Russia	238	273	408	216	216	0.00%	-16.62%
- from non-Eurasian countries	176	214	422	583	583	0.00%	3.54%
- from Eurasian countries	416	417	391	197	197	0.00%	-19.09%
Note: data covers cross-border remittances via money transfer systems and Russia’s postal service.
Note: the figures for 2022 are incomplete and do reflect Q1 2022 only.
Source: Central Bank of Russia (CBR).