The Mir bank card is widely used in Russia.

Russia, Asean countries adopting new payment systems

Russia and some members of the Association of Southeast Asian Nations (Asean) are in the process of adopting new payment systems after facing financial transaction difficulties as a result of ongoing sanctions against Russia.
Most Russian banks have been disconnected from the SWIFT system, while Visa and Mastercard payment systems are no longer working in Russia under the sanctions imposed by the West.
Vietnam is ahead of other members of the 10-member regional bloc as it has already adopted the new payment systems developed by Russia. 
So far, Vietnam is the only Asean nation to have agreed to connect to Russia’s Mir payment system cards, according to the Director of the Asean Centre at MGIMO University, Associate Prof. Dr Ekaterina Koldunova. 
However, by the end of last year, only 40 percent of Vietnam’s banking infrastructure was able to accept payments using Mir cards. By the spring of 2022, Mir bank cards were expected to be accepted by 80 percent of ATMs and POS-terminals in Vietnam, the TASS News Agency reported. 
The adoption of this system will make things easier for Russian tourists visiting Vietnam.
However, unofficial estimates suggest that Russian citizens face difficulties in using Mir cards in Vietnam, Dr Koldunova said in her article titled ‘Russia-Asean: Limits and Opportunities of Economic Partnership’.
To expand the system to other Asean members for broader use, Russia is negotiating with Myanmar on the use of the Mir payment system and connecting to the financial messaging system of the Bank of Russia. Similar plans have been announced for Thailand and Indonesia. 
Bangkok is working with Moscow to introduce the Mir card payment system in Thailand, the RIA Novosti news agency reported, citing Thai Ambassador to Russia Sasivat Wongsinsawat. 
Amid the current circumstances and certain financial constraints, there have been delays in the implementation of this scheme. The fast payment system is in high demand by Russian tourists, especially in Thailand’s most popular tourist destinations of Koh Samui, Pattaya and Phuket, the ambassador said.
“We hope that the bilateral system of fast payments will work soon and will help increase the volume of trade in goods and services between the two countries," Ambassador Sasivat was quoted by the news agency as saying.
Meanwhile, Indonesia is also discussing with Russia the possibility of introducing the Mir payment system, Indonesian Ambassador to Russia Jose Tavares told the TASS news agency.
"As for the use of the Mir card, we are now in the process of discussing this issue. We are working on it. We have a working group on finance between the two states," the ambassador was quoted by the news agency as saying.
Vietnam, in collaboration with Russia, is the most advanced among Asean members in terms of using the local currency for the purposes of trade.  
VTB Bank - a Russian state-owned bank - has allowed money to be transferred to Vietnam in Vietnamese dong starting from July 27, 2022. This will enable the two countries to fully facilitate and conduct business in each other's markets, according to the Vietnam News. 
As a result of the disconnection of most Russian banks to the SWIFT system, Russian businesses and their partners have encountered difficulties when it comes to financial transactions and payments in relation to trade, the CEO of the Russia-Asean Business Council, Daniyar Akkaziev, told Asean journalists recently. 
“This pushes us to think about trading in national currencies and some other mechanisms of how we can trade with each other using our currency, using some currencies of our close partners,” he said.
He was optimistic that use of the new payment system would address the difficulties encountered.
The CEO said it was important to set up the new payment infrastructure between Russia and Asean because more Russian companies are interested in doing business in Southeast Asia, amid the imposition of sanctions. 
In 2014 the Bank of Russia established the National Payment Card System Joint Stock Company (NSPK) which launched Mir payment cards. NSPK also processes domestic payments made in Russia using the cards of international payment systems, according to the bank. In 2019, the Faster Payments System (SBP) was launched.
At least 11 countries have hooked up to the Mir payment system. More than 15 countries have expressed their willingness to do this, according to a media report. 
As of October 1, 2022, some 212 banks were participants in the Faster Payments System. More than 2.9 billion transactions worth 15.2 trillion rubles were processed by this system.
However, this figure is far behind the number of participants in the SWIFT system, which is used by more than 11,000 banking organisations, securities institutions and corporate customers in over 200 countries and territories.
The materials for this article were prepared as part of the InteRussia Internship Programmeme with the financial and organisational support of the Gorchakov Fund in collaboration with the Sputnik News Agency.   

by Souksakhone Vaenkeo
(Latest Update October 19, 2022)