Kyrgyzstan had suspended the SWIFT system and further recommended that banking activities be halted until the country’s severe political unrest has been stabilized. After the parliamentary elections, massive protests have broken out as the antagonism has stormed the government buildings and then forced the prime minister to resign.
SWIFT and Banking Services Suspended
On Wednesday, the National Bank of Kyrgyzstan announced that the SWIFT system had been suspended in the country as the political unrest intensifies. The central bank has also “recommends that commercial banks and non-bank financial institutions suspend their activities and strengthen security measures until the political situation in the country stabilizes.”
The suspension followed numerous protests that have erupted last Monday after the elections in Bishkek’s capital city. The protesters have conflicted with the security forces and then breaking into the parliament building and the presidential administration building.
The opposition supporters have seized the government buildings Tuesday and then forced the cabinet to step down. Kyrgyzstan President Sooronbai Jeenbekov declared a state of emergency in Bishkek Friday and stated that he was ready to resign once a new cabinet has been chosen.
The official representative of the National Bank of the Kyrgyzstan Republic, Aida Karabeva, further explaining on Wednesday that the temporary suspension of SWIFT and the banking activities aim to prevent capital outflows from the country further elaborating:
“The measures taken are necessary to ensure the security of the system, the safety of assets. The National Bank is monitoring the situation, and as it stabilizes, the banking system will start its normal operation.”
The announcement says:
“The national payment system ‘Elcard’ continues to provide the ability to conduct non-cash payments. Payments and settlements can be carried out using non-cash and remote payment tools: bank payment cards, electronic wallets, Elcard Mobile application, QR codes, etc.”
Additionally, the head of the Union of Banks of Kyrgyzstan, Anvar Abdraev, stated recently that ATMs were further disconnected, and funds were removed from the machines to prevent operations and pillaging, Sputnik Kyrgyzstan news outlet reported.
“For small businesses and private transactions, cryptocurrencies can be a significant help,” experts say but cautioned that “such a means of payment may not be acceptable for large, especially regulated businesses,” a publication reported. Moreover, the National Bank of Kyrgyzstan had highlighted that cryptocurrencies did not have legal status even. However, their transactions exist in the country.
Last August, the Economic Ministry of Kyrgyzstan has prepared a draft law requiring the miners to register with the country’s tax authorities and state their activities. In June, the parliament has accepted the draft law “On Amendments to the Tax Code of the Kyrgyz Republic” in the third reading. It suggests a 15% tax rate for cryptocurrency mining.
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