Russia to create an alternative to Visa and MasterCard

The Russian ministry of Finance is going to introduce a draft bill on the national payment system in November 2009, reports the Kommersant newspaper. At the moment a group of experts engaged in development of the payment card system is working on the document.



The national payment system will probably be created on the basis of an existent Russian system in order to reduce dependence on the foreign market players.



Interestingly, the first attempt to set up a national payment card system was made in 1993 by the Bank of Russia, but it failed. Later some private companies ventured at running their own systems of that kind but never succeeded. In 2005 the Central Bank of Russia claimed the all-Russian payment system will be based on Sberbank's Sberkart system, which was renamed into the United Russian Payment System (URPC) in 2008.



Today, the major players on the Russian market are Visa and MasterCard accounting for more than 85% of all cards issued and transactions performed using payment cards. Besides, there are about 20 small payment systems operating in Russia, such as the URPS and Golden Crown (3% and 5% respectively).



By the 1 September 2009 Sberbank had issued over 35 million payment cards (3.5 million URPS cards, while the rest is Visa and MasterCard).



The truth is that Visa and MasterCard systems are already a part of the Russian market, while expenses on creation of a solely Russian payment system are huge.



source:

www.lenta.ru