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FACTBOX: What is known about QIWI Bank losing its license

The regulator stated that it had recorded cases of opening "Qiwi wallets" using the personal data of citizens without their knowledge

MOSCOW, February 21. /TASS/. The Bank of Russia revoked the banking license of QIWI Bank due to QIWI’s high-risk transactions aimed at facilitating settlements between individuals and shadow businesses. This is the first revocation of a banking license in the country since 2022.

The Contact payment system, which is part of QIWI services, stopped working. It is also now impossible to top up QIWI wallets and withdraw money from them.

TASS has collected the main facts about what happened.

Regulator's decision

In its decision to revoke the license on February 21, the Bank of Russia cites high-risk transactions aimed at facilitating settlements between individuals and shadow businesses, including the transfer of funds to crypto exchanges, illegal online casinos, bookmakers, etc., as well as looking for new ways to circumvent the restrictions imposed by the regulator.

The regulator stated that it had recorded cases of opening "Qiwi wallets" using the personal data of citizens without their knowledge.

The Bank of Russia sent information about illegal operations and circumvention of counter-terrorism requirements to law enforcement agencies.

The Bank of Russia stated that they do not consider Qiwi Bank a significant lender to the real sector of the economy. At the time of the license revocation, the credit institution ranked 89th by assets in the Russian banking system.

In the summer of 2023, the regulator already had problems with QIWI Bank. Then the credit institution stated, due to the regulator’s order, it had to partially limit the withdrawal of funds by individuals from wallets to bank accounts and cash withdrawals.

Implications for users

The Contact payment system, which made it possible to transfer money abroad, stopped working after the regulator revoked QIWI’s banking license.

Approximately an hour after the regulator’s announcement, depositing money into QIWI wallets and withdrawing funds from them became unavailable. The bank has about 15 million virtual wallets open.

The abilitiy to pay for services (cellular communications and the Internet) has become unavailable in the application and at ATMs of Metallinvestbank (included in the top 50).

QIWI services were actively used by individuals to pay for services, including from abroad, and also made it possible to replenish the balance of a number of services that had left Russia - Apple subscriptions, the Steam gaming platform wallet and others.

Deposit insurance

QIWI Bank's liability to depositors is insured for 4.6 billion rubles ($49.7 mln). Funds in electronic wallets were not insured.

Payments to depositors will start no later than March 6, the Deposit Insurance Agency reported. Agent banks will be selected through a bidding process no later than February 27.

It will take at least a year for the bank to liquidate all the assets. One can submit an application for reimbursement of the deposit during this period.

Funds in electronic wallets will be returned through levying and sale of bank assets and its property.

Consequences for the company

After the announcement of the revocation of the license, QIWI shares fell by almost 50% on the Moscow Exchange - to 240.5 rubles ($2.6), but later partially recovered the fall.

For the second time in a day, the Moscow Exchange announced a private auction for QIWI shares.

QIWI said that the rest of the company's business is operating as usual.

The Expert RA rating agency has withdrawn the credit rating from QIWI Bank. Before this, the credit institution had a rating of ruBBB-and a "under supervision" status.

The central office of Qiwi Bank in the south of Moscow is open, but a notice on the revocation of license is posted on its doors. Visitors are told that the bank no longer conducts operations.

License revocations

The revocation of the license from QIWI Bank is the first in Russia in almost two years. In 2023, not a single banking license was revoked. In 2022, only two banking licenses were revoked, which is the least in the previous 10 years.

In 2022, the WebMoney service lost its license, which was used in approximately the same way as QIWI.