Erdogan Proposes Turkish-Russian Payment System, Local Media Reports – Finance Bitcoin News

Turkish President Recep Tayyip Erdogan is reportedly pushing for Turkey and Russia to establish a new payment system between them. The initiative comes amid US pressure against the use of the Russian Mir cards in Turkey. Some Turkish banks have partnered with them to facilitate payments from Russian tourists visiting the country.

President Erdogan commissions Turkish government to develop Mir option, report

Turkish President Recep Tayyip Erdoğan has instructed ministers to develop a payment system with Russia to serve as an alternative to the Russian Mir banking system. According to the TV channel A Haber, Turkish and Russian officials have already held talks on this matter.

The move follows a statement from Washington that the US will try to persuade Turkey to limit its support for Mir. The cards are one of the few remaining options for Russians holidaying in Turkey, as Western sanctions have cut them off from major global credit cards and also destinations. Many of them visited Turkey this year.

Quoted by the Russian business newspaper Kommersant, A Haber revealed that the relevant Turkish and Russian authorities are now negotiating while President Erdogan himself will also participate in discussions on the topic.

In mid-September, the administration in Washington indicated that it may impose sanctions on nations that transact with Mir. Two of the five Turkish lenders that had worked with the Russian payment system, Isbank and Denizbank, suspended operations with it. The state-owned Halkbank, Vakifbank and Ziraat still use it.

Later, the US Treasury Department expressed its willingness to convince the Turkish government of the need to reduce the use of Mir. Last week, US authorities expanded the sanctions imposed over Russia’s invasion of Ukraine to include the CEO of the Central Bank of Russia’s National Card Payment System (NSPK), Mir’s operator.

NSPK processes domestic transactions in Russia. Moscow established Mir after the annexation of Crimea in 2014, when several Russian banks were denied services by Visa and Mastercard. Russia also developed the System for Transfer of Financial Messages (SPFS), an alternative to SWIFT, from which some Russian banking institutions have been disconnected.

During the current crisis, Russia has also turned its attention to cryptocurrencies. Earlier this month, the Ministry of Finance and the Bank of Russia agreed that under the current conditions, Russia must legalize crypto payments for cross-border transactions in order to relieve the pressure of sanctions on the economy and foreign trade.

Do you think Turkey and Russia will develop a new payment system to replace Mir? Share your expectations in the comments section below.

Lubomir Tassev

Lubomir Tassev is a journalist from tech-savvy Eastern Europe who likes Hitchens’ quote: “To be a writer is what I am, rather than what I do.” Besides crypto, blockchain and fintech, international politics and economics are two other sources of inspiration.