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The activities of some foreign participants of the international payments market will be restricted in Russia

02.05.2020
8 min read
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Pepeliaev Group advises that a legislative ban has entered into force for Russian credit institutions to complete operations aimed at accepting money from foreign payment operators as well as to perform international payment transactions involving foreign payment systems that do not comply with Russian legislation

On 28 April 2020, following the end of an extended transition period[1], the bans for Russian credit institutions have entered into force as provided for by article 3(8) of the Federal Law “On amending the Federal Law ‘On the national payment system’[2] and the Federal Law ‘On the Central Bank of the Russian Federation (the Bank of Russia)’”[3] (the “Law”). These bans oblige Russian credit institutions to suspend the acceptance of money and the performance of payment operations in the context of their relationships with foreign payment systems and suppliers of payment services which are active in the territory of the Russian Federation and whose activities, as at the above date, have not been brought in line with the previously established requirements.

Ceasing to accept electronic payment facilities from foreign providers of payment services

According to the provisions of the Law[4], by 28 April 2020 Russian credit institutions must cease to accept electronic payment facilities from foreign entities performing international money transfers (known as “foreign providers of payment services”, or “FPPS”)[5]), if such entities do not comply with the requirements of article 91 of Federal Law “On the national payment system”. A period of 270 days was granted for FPPS to comply with these requirements.

comment.jpgPlease be advised that, starting from 1 July 2020, Russian credit institutions will be obliged to provide data concerning FPPS to the Bank of Russia for such data to be included in the list of foreign providers of payment services.


The requirements in line with which FPPS should have brought their activities in Russia by 28 April 2020 include, among others, the following:

  • an FPPS should have an agreement with an operator for the transfer of money[6] setting out the terms and conditions for electronic payment facilities of such FPPS to be accepted in Russia; now, such agreement must contain the terms and conditions provided for by the Federal Law “On the national payment system”, concerning, in particular:

(a) the procedure for the parties to interact when disputed transactions are completed involving foreign clients’ electronic payment facilities;

(b) the period during which an operator of money transfers should receive funds from an FPPS when performing transfers to foreign clients (such period cannot exceed three days from the day when the relevant transaction was completed);

(c) the methods for securing the obligations of an FPPS in relation to an operator of money transfers (regarding the acceptance of electronic payment facilities from foreign clients);

(d) the obligation of an FPPS to identify Russian citizens and provide information about their transactions outside Russia;

(e) the obligation of an FPPS to provide to an operator of money transfers information concerning foreign clients[7];

  • the requirement for an FPPS to identify foreign clients;
  • the need for an FPPS to comply with the requirements of the Bank of Russia concerning the protection of information[8] as well as a number of other requirements provided for by article 91 of the Federal Law “On the national payment system”.

If, as at 28 April 2020, an FPPS does not comply with all the requirements established by article 91 of Federal Law “On the national payment system”, such FPPS will not be able to transfer funds for electronic payment via Russian credit institutions owing to the enacted ban.

Ceasing transactions aimed at cross-border money transfers performed by individuals within foreign payment systems

In addition, on 28 April 2020, another transition period[9] ends within which operators of foreign payment systems (“FPS”) performing transactions in Russia were obliged to comply with a number of requirements. Specifically, for FPS operators to continue their activities in Russia with regard to performing money transfers of individuals, these operators should have ensured that information about them was included in a special register of FPS operators maintained by the Bank of Russia[10].

We remind you that an FPS operator must file with the Bank of Russia an application to have the information concerning such operator included in the Bank of Russia’s register; this obligation is provided for by article 19.2(1) of the Federal Law “On the national payment system”. FPS operators should have filed such application via their standalone units (i.e. via their branch or representative office) in Russia.

The information concerning FPS operators that must be included in the Bank of Russia’s register is publicly available and contains, in particular, the date when the FPS operator was included in the register, the full and abbreviated corporate name of the FPS operator, the country and registered address of the FPS operator, the address of its official website in the Internet, the electronic mail address of the FPS operator, the bank details of the standalone unit of the FPS operator in Russia, as well as other data.

Starting from 28 April 2020, Russian credit institutions must cease cross-border money transfers of individuals within the framework of FPS if the information concerning the operators of such FPS has not been included by the Bank of Russia in the register of FPS operators.

As at the above date, information concerning only one FPS operator had been included in the Bank of Russia’s register, namely, MoneyGram Payment Systems, Inc., a US-registered corporation operating MoneyGram, a foreign payment system.

comment.jpgPlease be advised that the Federal Law “On the national payment system” provides for cases in which the Bank of Russia has the right to subsequently exclude information concerning FPS operators from the above register. Should this occur, then, starting from the day when the Bank of Russia excluded the relevant FPS operator from the above register, Russian operators of money transfers are prohibited from accepting, within the framework of such FPS, the orders of individuals for cross-border money transfers, whereas cross-border transfers which were initiated before the above date should be completed pursuant to the rules of the relevant FPS.

The impact of the bans on major FPS pursuing their activities in Russia

According to the Federal Law “On the national payment system”[11], the requirements to have the information concerning FPS operators included in the Bank of Russia’s register do not apply to foreign organisations which have subsidiary business entities in the territory of the Russian Federation which are operators of payment systems registered by the Bank of Russia. Neither do these requirements apply to international financial organisations and foreign central (national) banks.

Thus, the bans that came into force on 28 April 2020 will not affect the activities of major FPS (such as Visa, Mastercard, Western Union, American Express, Union Pay and others) since they have subsidiaries registered in Russia which are already included in another register of the Bank of Russia: the register of operators of payment systems[12].

What to think about and what to do

Russian credit institutions which interact with FPPS or FPS are recommended to make sure that the above foreign participants of the financial and credit system comply with all necessary requirements of Russian legislation and cause these requirements to be complied with in future; in doing so, they will prevent foreign counterparties from being excluded from the Bank of Russia’s register and restrictions from being imposed on their activities aimed at the acceptance of payments and completion of transactions.

Help from your adviser

Pepeliaev Group's experts possess extensive expertise of advising on the application of banking and financial law as well as in the area of financial information technologies (FinTech). We are ready to provide legal assistance in relation to any issues in the above areas, including in relation to credit institutions complying with the requirements of the Federal Law “On the national payment system”.



[1] We remind you that most of the provisions of the Law which establish the relevant bans came into force on 2 August 2019 (on the date when the Law was officially published); however, transition periods of various durations were introduced in relation to some of its provisions. On 28 April 2020, the longest transition period ended, which lasted for 270 days

[2] Federal Law No. 161-FZ “On the national payment system” dated 27 June 2011

[3] Federal Law No. 264-FZ “On amending the Federal Law ‘On the national payment system’ and Federal Law ‘On the Central Bank of the Russian Federation (the Bank of Russia)’” dated 2 August 2019

[4] Article 3(8)(1) of the Law

[5] According to the definition set out in the Federal Law “On the national payment system”, a foreign provider of payment services is a foreign company which has the right, under the laws of the relevant foreign state (at the place of registration) and by virtue of a licence (or another permit), to provide services aimed at transferring money on bank accounts/without opening bank accounts/perform transactions involving electronic payment facilities

[6] An entity which has the right, under Russian legislation, to perform money transfers

[7] The Federal Law “On the national payment system” also sets out other terms and conditions which must be included in an agreement between an FPPS and an operator of money transfers

[8] The requirements are established by Regulation No. 382-P dated 9 June 2012 “On the requirements to ensure the protection of information when money transfers are performed and on the procedure for the Bank of Russia to control compliance with the requirements concerning the protection of information when money transfers are performed”

[9] The duration of the transition period was 270 days from the date when the Law was adopted

[10] The Register of operators of foreign payment systems (http://www.cbr.ru/registries/nps/).

[11] Article 19.2(19) of Federal Law No. 161-FZ “On the national payment system” dated 27 June 2011

[12] The Register of operators of payment systems (https://www.cbr.ru/registries/nps/rops/).

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