Payment technology in Russia is a political hotbutton
April 25, 2014
Don’t leave home without it? Never true of Visa or Mastercard, and certainly not now in Russia. The international payments giants froze service on cards issued by several Russian banks following sanctions announced by the US. In response, Russia has announced it will build its very own National Payment Card System and place it under the authority of the central bank.
The provision and control of financial infrastructure is always a profoundly political issue, but never more than when technology is a conduit of the antagonism between state governments. According to political economists Natalia Kaurova and Anastasia Nesvetailova in a comment posted at FT’s Alphaville, “the full significance of the move must be understood in the context of the general desire of the Putin regime to isolate and protect the country from political risks”.
Anthropologist Bill Maurer who studies the commercial payments industry has shown that the control over money and payment is seeping into private infrastructures like Visa and Mastercard as well as unregulated networks like mobile phone accounts and Bitcoin. He has long argued that electronic payment systems are not just a way of transferring money, but maybe eroding the underlying authority of the state as they evolve into full-fledged alternatives to state currencies.
The events unfolding in Russia are an interesting counterpoint to Maurer’s research: What would happen if digital infrastructure was harnessed as a means of reinforcing state control over how people pay for things? And from a technology and engineering standpoint, is such a large-scale project still possible?