Moscow and Tehran officially link payment systems, allowing Iranians to withdraw cash in Russian ATMs

Iranian women wrapped in their country's flags walk down Moscow's central Nikolskaya Street during the 2018 FIFA World Cup in Russia / Photo: Alexander Vedernikov, Kommersant

Iran's “Shetab” payment system has officially been linked to Russia's “Mir,” the Iranian news agency Tasnim reported today. This connection enables Iranian bank cardholders to make cash withdrawals in rubles at Russian ATMs.

The project's next phase will see Russian cards activated for use in Iran, allowing for cash withdrawals at local ATMs. In the final stage, Iranian cards will become usable for payments in Russian retail stores.

According to a report by the Mehr news agency, Mohammad Reza Farzin, head of Iran's Central Bank, previously stated that the agreement to connect “Mir” and “Shetab” was finalized during discussions at the Bank of Russia's Financial Congress in St. Petersburg this past July. The report also noted that Moscow and Tehran are in talks to develop a payment service that could rival SWIFT — the international system which has imposed sanctions on both countries.

Russia’s National Payment Card System (NSPK) — an entity owned by the Russian Central Bank, which operates the “Mir” cards — was sanctioned by the U.S. Treasury Department on Feb. 23, 2024, in a package marking the second anniversary of Russia’s invasion of Ukraine — and one week after the death of opposition activist Alexei Navalny.

“The Government of Russia’s proliferation of Mir has permitted Russia to build out a financial infrastructure that enables Russian efforts to evade sanctions and reconstitute severed connections to the international financial system,” read the Treasury’s press release.

The Mir-Shetab integration is the latest step in the expanding relationship between Russia and Iran as the two countries continue to grapple with international sanctions.

The military partnership between Moscow and Tehran has notably strengthened following the onset of Russia’s full-scale invasion of Ukraine, with Iran providing Russia extensive supplies of Shahed drones. Russian forces have heavily utilized these UAVs to strike Ukrainian cities and infrastructure, causing substantial damage and casualties — Ukraine reported a record 145 of these drones launched by Russia at various targets across the country last Saturday alone. In particular, the Shahed-136 (dubbed the “Geran-2” in Russian service) has been employed in large numbers.

CNN has described the Shaheds as being “cheap, one-way attack drones.” As the publication further explained: “They are ‘fire and forget,’ meaning a flight path is programmed, the UAV is launched, and it then independently flies towards the target area.” Russia has domesticated the production of Shahed drones at the Alabuga Special Economic Zone (SEZ) in Tatarstan, with Ukraine targeting the facilities in a number of deep strikes earlier this year.

On Sept. 10, 2024, the U.S. Department of Defense confirmed reports that Iran had transferred shipments of Fath 360 close-range ballistic missiles to Russia. Reports of Tehran providing Moscow with ballistic missiles had circulated since late 2022, but they varied in degrees of certainty and were inconsistent with regard to the types of missiles that were allegedly shipped.

The Insider’s defense analyst Colby Badhwar recently detailed the deepening ties between informal anti-Western allies China, Russia, Iran, and North Korea — dubbed the “CRINKs” — and outlined the consequences of the West’s inaction as the four authoritarian countries bolster their military capabilities.

The relationship also has a civilian dimension. Photos from Russian stores taken in late 2022 revealed that Iranian-produced Coca-Cola, manufactured under license in Iran, is now being stocked on shelves in cities like Tyumen. The Iranian version of the beverage — distinguished by its Perso-Arabic script on the can — has been supplied by some stores in place of Russian-made Coca-Cola after U.S. drinks giant The Coca-Cola Company suspended operations in Russia in March 2022.

The two countries signed a fully-fledged free trade pact in October 2023, which removed customs duties on nearly 90% of goods, setting up sets up a preferential trade regime for most commerce between Russia and Iran. Russia has also invested in promoting tourism in Iran, with authorities in St. Petersburg spending $300,000 last year on a roadshow promoting the city as an attractive foreign travel destination for Iranians.