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A Russian backed bank payment card, introduced after Western sanctions upended Russia’s financial system five years ago and prompted Visa and Master card to deny electronic services to some of the country’s leading banks, is set for its European debut on London Wednesday, when a pilot project will be launched in collaboration with the Dutch global payment company PayXpert.
Moscow authorities hoped to get the MIR card accepted eventually in foreign markets, but progress has been slow outside Russia for the MIR payment system, which operates outside of Western-controlled international financial systems such as Swift, which banks use to transfer money.
The pilot project with PayXpert “will lay the foundation for new promising trends in the foreign expansion of Russian payment cards,” according to Vladimir Komlev, the head of Russia’s National Card Payment System, which operates the MIR system.
The effort is seen by analysts as part of the Kremlin bid to de-dollarize the Russian economy to lessen the sting of Western sanctions. A Russian Finance Ministry official this month told Reuters that Russia will next year diversify its foreign currency holdings in its National Wealth Fund, which supports Russia’s public pension system, aiming to lower the share of dollars in the fund’s reserves.
Dmitry Dolgin of the Dutch banking group ING said in a report this month that de-dollarization efforts are now obvious across most sectors, including local business loans and bank-held international assets, although he said the dollar’s role has actually increased in company and household savings and cash assets, partly because dollar interest rates have been higher than those offered for euros.
U.S. authorities have been able advance sanctions by targeting companies that use dollars, and the establishment of electronic payment systems not tied to the dollar or largely controlled by U.S. businesses is one way for the Kremlin to reduce the impact of the West’s serial punishment of Moscow. Washington and the European Union have imposed a wave of sanctions since 2014 to punish Russia for the 2014 annexation of Ukraine’s Crimean peninsula, alleged meddling in the 2016 U.S. elections, and the poisoning of a defected Russian spy in England.
Komlev told Reuters this year that “In the next three years we want MIR cards to be operational in countries where Russians are used to traveling.” He projected MIR cards would be operational at some banks in at least a dozen countries by the end of this year. Turkish banks started to conduct transactions this year with MIR, which means both “peace” and “world” in Russian.
MIR was launched initially as a national payment system, with the first cards issued in December 2015. Russia’s leading bank, state-owned Sberbank, started issuing them in October 2016, and by the end of last year more than 70 million MIR-based cards had been issued by 64 Russian banks. The Kremlin has mandated that state welfare and pension payments must be processed through the system by next year, along with salaries paid to civil servants.
The card has a long way to go before it rivals VISA our Mastercard internationally. It is not accepted by international shopping platforms or major online booking services for airlines and hotels, although APEXX Fintech, a British start-up global payment company, said Thursday it would now start working with the MIR system. Among smartphone applications only Samsung has concluded an agreement with the MIR system.
Meanwhile, de-dollarization has been moving quickly. Russia’s Central Bank has currency swap deals in place with Iran, China and Turkey, allowing direct trade to be conducted in local currencies instead of U.S. dollars. Russia reportedly lost $7.7 billion in its bid to reduce dollars held in its reserves. Some of the dollars were turned into gold, and since January the bank has purchased 96.4 metric tons of gold.
Alexei Zabotkin, head of the Russian Central Bank’s monetary policy department, has conceded that it would be impossible to completely empty the country’s foreign exchange reserves of dollars, as this would be “fraught with excessive risks.” According to central bank data the National Wealth Fund has $45.5 billion, 39.17 billion euros and 7.67 billion British pounds.
In August, the state-controlled Rosneft oil giant announced it would stop using the U.S. dollar for its export contracts.
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Nonetheless, analysts say there are limits on how far Russia can de-dollarize – the ruble is highly volatile and remains unattractive for investors and de-dollarization brings additional and sometimes prohibitive trading costs.
European regulators will be watching the London project closely. EU officials have been sympathetic about Russia’s de-dollarization bid, suspecting that as a spin-off the euro will be boosted as an international currency. In June the European Commission concluded that “the euro clearly stands out as the only candidate that has all the necessary attributes of a global currency that market participants could use as an alternative to the U.S. dollar.” (VOA)
By Nimerta C Sharan
Your monthly round up of the latest lifestyle launches, from luxury indulgences to artisanal creations, here's what you can look forward to :
Exciting news for all handbag lovers, luxury fashion house Louis Vuitton recently launched their limited edition handbags 'Artycapucines - Chapter 3'. Six internationally -- acclaimed artists have transformed the black canvas of the timeless Capucines bag into beautiful art pieces. Each bag will be available in a limited edition of 200 and will be released worldwide at the end of October 2021.
Exciting news for all handbag lovers, luxury fashion house Louis Vuitton recently launched their limited edition handbags. | Photo by Erik Mclean on Unsplash
Add To Cart
Looking for a quick festive fashion fix for you and your loved ones? E-commerce giant AJIO has announced it's hottest fashion sale starting September 30, 2021. The shopping platform has roped in stylista Sonam Kapoor as the face of the sale that will offer more than 2500 brands at discounted prices.
E-commerce giant AJIO has announced it's hottest fashion sale starting September 30, 2021. | Photo by Mitchell Luo on Unsplash
The country's leading design house, Good Earth, in collaboration with textile designer Madeline Weinrib will present its collection of 'butah' motif dinnerware and home textiles at the Metropolitan Museum of Arts, New York. The 'Heirloom Project' that honours diverse Islamic design techniques will display curated products from across the globe.
The 'Heirloom Project' that honours diverse Islamic design techniques will display curated products from across the globe. | Photo by Jean Vella on Unsplash
Sweet dreams are made of this! Iconic French patisserie Laduree has opened its first Indian outpost at Delhi's upscale Khan Market. Spread over three floors, the bakery currently has twelve macaron flavours, their signature pastries and tea cakes and other brunch and high-tea items on the menu. Bon appetit.
Iconic French patisserie Laduree has opened its first Indian outpost at Delhi's upscale Khan Market. | Pixabay
Bright And Beautiful
Raw Mango's latest festive edit 'Moomal' goes live on their website on September 26, 2021. Inspired by the richness and diversity of Rajasthan, the collection consists of organza and silk saris and shararas, gota lehengas and kurtas and embroidered odhnis. The colours and silhouettes are just right for the upcoming festive season. (IANS/ MBI)
Raw Mango's latest festive edit 'Moomal' goes live on their website on September 26, 2021. | Photo by Souravi Sinha on Unsplash
Keywords: Lifestle, AJIO, sale, Deepika PAdukone, saris, Motifs, artisan, art
Actress Kangana Ranaut has talked about how her weight adjustments for her latest 'Thalaivii' that "messed up many things" in her body and left her with "permanent stretch marks". For her role in the film, based on the life of late Tamil Nadu Chief Minister and former actress J. Jayalalithaa, Kangana had to gain 20kg and undergo major physical transformation several times.
She took to Instagram to share her experience, detailing that doing all that over the six months period left her with "permanent stretch marks". "Gaining 20 kgs in 6 months and loosing it all within 6 months that too in my thirties messed up many things in my bodya I also have permanent stretch marks as well but art comes to life with a price and more often than not price is the artist him/herself," she wrote.
"Thalaivii" showcases the varied aspects of Jayalalithaa's life, tracing her journey as an actress at a young age to becoming the face of Tamil cinema, as well as the rise of the revolutionary leader who changed the course of the state's politics. Talking about her upcoming works, Kangana currently has 'Dhaakad'.
She is also shooting for her next 'Tejas', where she plays a fighter pilot. The Indian Air Force was the first of the country's defence forces to induct women into combat roles in 2016. The film takes inspiration from the landmark event. 'Tejas' is directed by debutant Sarvesh Mewara. The film will be RSVP's second film which pays a tribute to the Indian military after the immensely successful film "Uri: The Surgical Strike" which was released in January 2019. (IANS/ MBI)
Keywords: Kangana Ranaut, Thalaivii, bollywood, stretc marks, actress, tamil cinema
Signal's encrypted messaging app continues to be down on Monday after facing global outage on Sunday. The firm said it is working to fix it. "Hold tight, folks! Signal is currently down, due to a hosting outage affecting parts of our service. We're working on bringing it back up," the firm said in a tweet on Sunday.
The status website says the encrypted messaging app is "experiencing technical difficulties" and many people are also getting an in-app error message that says the same thing. Signal allows for secure and encrypted video, voice and text communication, but users are unable to send any messages.
According to Downdetector.com, users started reporting outages around 11:05 PM Eastern Standard Time and it appears to be affecting people around the world. Comments shared on Downdetector.com indicates that Signal was down for users from India, US, Germany, New Zealand, Netherlands, Australia, Brazil and many other countries.
"Down in Midwest USA. Signal was started by people connected to which secret 3-letter organization? (Look it up) Yep, that's right! An app disguised a privacy app to trick you into sharing more private information than you would with another messaging app," a user said. "I think Signal is having a rough day. Good luck, Team Signal. I'm sure you'll have it sorted out in a snap," said another. The encrypted messaging service has climbed to the top spot in the free apps category of the App Store in multiple countries, including India. (IANS/ MBI)
Keywords: Signal, app, encrypted, messages, outage, down