Presenting the Meanwhile in Russia #6 – most significant news from the Russian payments market. To get the news directly to your phone subscribe to our Telegram channel
▪ Banks will be allowed to exchange information about droppers
Russian legislators intend to allow banks to exchange information about the accounts of straw men as well as close their accounts. At the moment exchange of this information is prevented by bank secrecy laws and unlike AML/CFT bank are not allowed to refuse service to straw men. The data will be shared via FinCERT (a division of the Bank of Russia of Cybersecurity), which will form a single database on embezzlement or attempted money theft and bring this information to the market. However, banks want this information to be kept by the entity independent of the regulator – for example, credit bureaus.
▪ Bank of Russia will become a mystery shopper
Employees of the Russian Central Bank responsible for supervising banks, will use a mystery shopper approach to find violations in financial institutions. They will contact the call centers and bank branches, appearing as potential customers who want to deposit money. The Central Bank will look for two types of violations. First is provision of non-monetary hidden incentives for the depositors that increase the effective deposit rate. Second is finding the signs of off-balance-sheet deposits or attempts to sell complex bank products to the unqualified consumers. Recently Bank of Russia and the Deposit Insurance Agency discovered more than 150 billion rubles of funds not shown in the balances of the bankrupt banks.
▪ Russians will be able to transfer money using QR-code in instant messengers in 2019
In 2019, Russians will be able to transfer money to each other via QR-codes via instant messengers (WhatsApp, Viber, Facebook Messenger) and social networks (VKontakte, Odnoklassniki, Facebook). Using QR-codes will be an alternative to a phone number. Using a special application, the user will generate his individual QR-code that incorporates the beneficiary name, account no, bank, and other relevant information. To send money, customer will only need to scan the QR-code and enter transaction amount in a dedicated app. Experts expect that the innovation will increase the volume of non-cash transactions by 40%.
▪ The Ministry of Finance of Russia proposes to introduce a unique identifier for borrowers
Banks, microfinance institutions, credit cooperatives and pawnshops will be required to assign unique identifiers to all existing contracts with their customers and submit them to the credit bureau. The draft law implementing this was published for public discussion by the Ministry of Finance. The new code is expected to simplify the task of calculating the total customer's debt load, eliminate duplication of records and "breaks" in the credit history when changing a passport. At the moment there is no unique identifier of the borrower and customers are identifying using the name and document number. It is yet unclear how new ‘unique identifier’ will relate to other identification information.
▪ The Bank of Russia disclosed the valuation of the volumes and structure of suspicious transactions
Bank of Russia for the first time published an assessment of the volumes and structure of suspicious transactions. This aggregated data is based on the information received from the banks. 47% of suspicious cash-out transactions were made using payment cards and accounts by individual customers, 41% - using corporate payment cards, cash-outs by individual entrepreneurs amounted to 5% of suspicious transactions.
Layering is mostly done through straw men using payment cards (38%) or by re-selling cash by the businesses (29%). Other typologies include involvement of tourist companies (11%), precious metals sector (11%) and payment agents (4%).
Bank of Russia plans to publish this information regularly and hold meetings with the private sector to improve usage of data for AML/CFT purposes.