The Central Bank of Russia will gain more control in payments in the country. The new rules have been evaluated at length.
The Russian government had, in August 2019, banned foreign companies from operating in the country without having a domestic presence in the country. However, the regulation was not implemented. Nevertheless, in mid-April, the authorities revisited the rules and enforced them, leaving the financial firms in the country in need of change.
Foreign digital payment service providers in the country had to adhere to harsh requirements and change their operations. CFD brokers operating in Russia complained about the challenges the Ministry of Finance imposed on payment firms. However, with the proper guidance, the firms were able to comply with the new regulations. Financial firms operating in Russia needed a new legal and payment infrastructure to support their operations.
Change experienced in Russian Financial landscape
Domestic firms operating in Russia and foreign companies will have to give their clients comprehensive details regarding their services. The information will also have to be shared with the Central Bank. The essential data to be shared is the fees charged for the services offered by these firms.
To achieve this, payments can only be made if the payment service provider does not have any information to verify a client’s details and if the company information is unavailable or limited. This change is expected to reduce the number of new clients who will register with payment platforms.
How financial firms can keep up with the change
The changes in the financial landscape are posing significant challenges to a lot of clients and businesses. Small and large firms are working around the clock to ensure that they develop viable solutions for them to remain in operation in the country. To create a solution, all a firm needs to do is work with the regulations and find the best operation models that adhere to compliance.
One solution that will work is to select a legal team that understands the environment and know how to best tailor a solution that meets your needs. The legal team should also have explicit knowledge about the present obstacles and how you can avoid them.
Regulating the legal and payments frameworks is essential for the Russian regulators, given that firms operating the sector have to remain compliant in adhering to new rules. This is done to comply with the AML and CFT laws.