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April 21, 2022

China’s UnionPay backs out of deal with Russian banks fearing sanctions

Understand the impact of the Ukraine conflict from a cross-sector perspective with the Global Data Executive Briefing: Ukraine Conflict

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2022: So far In Venture Capital

Global investment in 2022 has been majorly dominated by North America, Europe, and Asia Pacific, whereas the Middle East, and South and Central America have recorded low investments comparatively. In light of this, Europe and North America have been identified as the major destinations for Private Equity and Venture Capital (PE/VC) investments.   GlobalData’s whitepaper analyzes which sectors PE/VC firms have been investing in, looking at Technology, Media, and Telecom, with these sectors recording $356 billion and a deal volume of over 10,000 deals in 2022. Healthcare, Financial Services, Business & Consumer Services, and Construction sectors have also seen high investment activity by PE/VC firms, recording a deal value of over $70 billion each.   But what can this mean for you?   Understand how the Deals Database on GlobalData Explorer can be leveraged to:  
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by GlobalData
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Chinese payment services provider UnionPay is reluctant to work with Russian banks over the fear of secondary sanctions, Russian news outlet RBC reported. 

UnionPay abandoned its plans to issue cards in partnership with Sberbank and suspended talks with other lenders, several sources told the publication. 

“The project is temporarily on pause, they do not officially confirm the connection with the sanctions, they say that it is on pause until further notice,” one of the sources was quoted as saying. 

After the Russian invasion of Ukraine, payment majors such as Mastercard, Visa and American Express suspended their operations in Russia. 

The sanctions forced Russian banks to turn to China’s UnionPay for card issuance.

Apart from Sberbank, VTB Bank, Alfa-Bank, Otkritie Bank, and Promsvyazbank were among those looking to work with UnionPay.

These major Russian banks including Sberbank are subject to severe sanctions from the US-led Western alliance.

The restrictions render the cards issued by sanctioned banks outside Russia useless as banks of nations that have imposed sanctions do not service Russian banks’ cards irrespective of the payment system. 

Notably, UnionPay continues to operate with banks that are not subject to sanctions, one of the sources added.

Earlier, the Central Bank of Russia had said that Russian-issued Mastercard and Visa cards can be used within the country until their expiry.

Meanwhile, the central banking authority has registered a new payment system called HELLO to dampen the impact of sanctions imposed on Russia. 

Free Report
img

2022: So far In Venture Capital

Global investment in 2022 has been majorly dominated by North America, Europe, and Asia Pacific, whereas the Middle East, and South and Central America have recorded low investments comparatively. In light of this, Europe and North America have been identified as the major destinations for Private Equity and Venture Capital (PE/VC) investments.   GlobalData’s whitepaper analyzes which sectors PE/VC firms have been investing in, looking at Technology, Media, and Telecom, with these sectors recording $356 billion and a deal volume of over 10,000 deals in 2022. Healthcare, Financial Services, Business & Consumer Services, and Construction sectors have also seen high investment activity by PE/VC firms, recording a deal value of over $70 billion each.   But what can this mean for you?   Understand how the Deals Database on GlobalData Explorer can be leveraged to:  
  • Track the Aggregate Investment Volumes in PE/VC-Stage firms across geographies and sectors, in addition to viewing the specific deals that drove these volumes
  • Identify the top investors already active in any sector-Geography combinations
  • Assess the Performance of Financial and Legal Advisors, supporting the Dealmaking in any segment of choice (Customizable League tables)
  • Understand what is driving the PE/VC fundraising (Deal Rationale)
  Consult our full report here and optimize your business strategy.
by GlobalData
Enter your details here to receive your free Report.

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