August 19, 2016
With great fanfare, the Iranian government rolled out an announcement Saturday that Iranians will now be allowed for the first time to use an international credit card, MasterCard, to buy goods from abroad. MasterCard said that was nonsense.
Telecommunications Minister Mahmud Vaezi announced that 155 post offices around the country would have MasterCard available for Iranians as of August 23.
The cards won’t be usable for domestic purchases, he indicated, but will be good for payment transactions while traveling abroad or to buy goods by mail from foreign firms.
The Iran Times contacted MasterCard. Seth Eisen, the vice president for external communications, responded: “MasterCard does not have any activities in Iran, as sanctions have remained in place for US-based companies for some time.”
While sanctions imposed because of Iran’s nuclear program were removed in January, other sanctions remain in place, including the ban—with a few exceptions—on Americans exporting to, importing from or investing in Iran. There is also a ban on financial transactions with Iran that would appear to shut out MasterCard and other American-based credit cards.
In making the announcement of a deal with MasterCard, Telecommunications Minister Vaezi did not address the issue of sanctions or say how he thought a deal with MasterCard could be made. Some American firms are planning to deal with Iran through foreign subsidiaries. To do so, they will have to have people who are not US citizens handle all aspects of the business with Iran.
Mehr news quoted Vaezi as saying, “The Vison Card project, as the representative of MasterCard in Iran, has inked a contract with the Iran Post Company to meet the needs of people traveling abroad, purchasing foreign articles, as well as participating in international conferences through credit cards.” An Internet search shows that “Vison” card is a gift card usable wherever MasterCard is accepted. The company issuing Vison cards is located in Recife, Brazil.
Vaezi said the cards would be debit cards—which is what gift cards are—that owners could charge with up to $10,000 at a time. But transactions with Iran in US dollars are barred by sanctions.
The absence of internationally recognized credit cards in Iran has been an issue cited as a primary example of the country’s isolation from the global economy due to the policies of the Islamic Republic. The government has long tried to link up with some international credit card firm. Iran is one of the few countries—and the only large country—where major international credit cards are unusable.
The Iranian media have been forecasting a deal with MasterCard for months. Iranian media reported back in December that MasterCard was reaching out to Iran by launching a public relations campaign in Farsi on social media. This was interpreted as a desire by MasterCard to set foot in the Iranian market.
