One country that has been in the middle of a prolonged economic depression is Venezuela and despite the country’s vast reserves of oil, there seems to be no way out for the citizens. The country is suffering from severe food shortages, runaway inflation, and other troubles that one associated with nations which are in dire economic peril. The situation has also crippled the banking industry in the country as well, and in a new development, one of the country’s leading banks has involved itself in a feud of sorts with payments giant Mastercard. The military now governs the country and it controls the banking sectors as well. The Armed Forces Bank of Venezuela hammered payments giant Mastercard for having halted its services for the credit cards that had been issued by the bank.
The move from Mastercard came about due to the sanctions placed on the country by the United States. The United States is opposed to the current President of Venezuela Nicolas Maduro and has imposed a range of sanctions to cripple the leadership. The sanctions placed by the United States are having a huge effect on many institutions that are governed by the state and the plight of the Armed Forces Bank is only the latest example. That being said, it is important to note that the bank in question is not one of the bigger banks in the country and moreover, the usage of credit cards is not as widespread. The hyperinflation in the country has made it difficult for banks to maintain credit limits properly.
However, the bank did take to its Twitter account to denounce the move made by Mastercard. In the statement that was posted on the social media website, the Armed Forces Bank said,
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 new leadership in Venezuela has not been welcomed in the United States and the state department has imposed a range of sanctions to make life difficult for the new rulers. As part of those sanctions, Mastercard has been asked not to provide its services in Venezuela after March next year. In addition to Mastercard, Visa and American Express had been told the same.