Elaine Jean Tech 02.27.2022 11:Feb AM EST

Apple Pay and Google Pay Discontinue Services to Russians as Part of US Sanctions

Apple Pay and Google Pay would not be accessible to Russian customers for the unforeseeable time.

President Joe Biden addressed the nation on Thursday (Feb. 25) stated that America, along with its allied countries, will impose economic sanctions on Russia as part of its political consequences.

The sanctions were immediately imposed. Thereafter, thousands of Russian citizens were affected through their bank transactions.

The Effect of Apple Pay and Google Play

The Central Bank of Russia reported that its customers are unable to access contactless transactions from both American tech giants. This is due to the issues of the cards issued by the banks in Russia since other countries' sanctions have been imposed.

The Russian banks affected by the financial sanctions are Sovcombank, Novikombank, Promsvyazbank, VTB Bank, and Otkritie. Russian citizens with banks to any financial institutions will not be able to make international transactions to countries that have agreed to implement sanctions on Russia.

Apple Pay is an online platform that can be accessed on multiple Apple devices such as the iPhone and the Apple Watch.

It is a "digital wallet" that can be used with Apple devices such as the iPhone and Apple Watch. This digital wallet allows users to make purchases using their device rather than having to take out their wallet, purse, credit card, or cash first.

On the other hand, Google Pay is also a digital wallet platform, allowing users to purchase, transfer, and pay for numerous merchant partners that require payments. Developed by Google, it also enables users to make contactless payments on mobile devices in-app, online, and in-person.

Like Apple Pay, Google Pay's digital wallet can also be accessed on multiple devices such as Android phones, watches, and tablets.

However, as clarified by The Verge, the two most popular mobile payment platforms in Russia are Sberbank Online and YooMoney.

This only means that only a few Russians use Apple and Google Pay for their payment transactions.

Possibility of FinTech Unrest?

President Vladimir Putin had launched an invasion of Ukraine on Thursday (Feb.24). Russians awoke to the news of the war as their military forces were sent to launch an attack on Ukraine.

As reported by Business Insider, countries that imposed sanctions on Russia are the United Kingdom, Australia, United States, and EU countries. These countries are also imposing economic sanctions and financial US sanctions. The countries have threatened all together that foreign-held assets of Russian banks- Sberbank, General Bank, IS Bank, Rossiya, and the Black Sea Bank, will be frozen.

An increase in sanctions has been implemented in response to Moscow's order to invade Ukraine. However, Russian President Vladimir Putin claimed it was an act of self-defense against NATO's expansion into eastern Europe.

According to the Wall Street Journal, people in Russia have been queuing up at ATMs to withdraw U.S. dollars. Russians fear that the value of the Russian currency Ruble will continue to plummet. In addition to that, it has also been reported that the country is running out of dollars as people try to withdraw massively.

If this continues, this might leave banks with insufficient capital to lend and finance their customers.

Furthermore, it may be possible that US sanctions in fintech and numerous industries to Russia will continue to increase over time if the conflict between Russia and Ukraine continues.