Get 40% Off
🤯 This Tech Portfolio is up 29% YTD! Join Now to Get April’s Top PicksGet The Picks – Just 99 USD

Venezuela's Armed Forces Bank slams Mastercard for halting card service

Published 09/04/2019, 08:49 PM
Updated 09/04/2019, 08:51 PM
Venezuela's Armed Forces Bank slams Mastercard for halting card service

Venezuela's Armed Forces Bank slams Mastercard for halting card service

CARACAS (Reuters) - A Venezuelan bank run by the troubled country's military on Wednesday slammed Mastercard (NYSE:MA) for cutting off service to the bank's credit cards following U.S. sanctions against the government of President Nicolas Maduro.

The measure is another sign of how U.S. sanctions are affecting the functioning of Venezuelan state institutions.

But the practical impact is limited because the bank is small and hyperinflation has reduced use of credit cards, whose credit limits rarely keep up with price increases.

"The Bank of the Armed Forces denounces to its civilian and military clients ... the suspension of interbank services for its credit cards on the part of the American company Mastercard," the bank said in a statement posted on Twitter.

The U.S. Treasury Department in March told Visa (NYSE:V), Mastercard and American Express (NYSE:AXP) that they could not continue doing business with Venezuelan state institutions after March 2020.

That was part of a broad set of sanctions against Venezuela's government that is meant to push Maduro from office and support opposition leader Juan Guaido, who in January invoked the constitution to assume a rival interim presidency.

Commerce in Venezuela's collapsing economy depends heavily on debit card transactions, which operate principally on a local platform, and increasingly on dollars and euros in cash.

Venezuelan bank regulator Sudeban earlier this year asked local banks to design a new payment system, according to a financial sector source, who added the project has not been completed.

"#Mastercard should know that its arbitrary action will not intimidate us," Bank of the Armed Forces President Dario Baute wrote via Twitter. "The @BanFANB technology team is stronger than you think and our legal team will respond with the same force with which you attacked us."

Mastercard, Venezuela's Information Ministry and the Bank of the Armed Forces did not respond to requests for comment.

Mastercard also halted services to state-run Agricultural Bank. Phone numbers published on that bank's website were disconnected.

Latest comments

Risk Disclosure: Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.
© 2007-2024 - Fusion Media Limited. All Rights Reserved.