“If I could leave Russia right now, I would. But I can’t quit my job”, says Andrey.
And this young man from 31 years cannot afford to take on a mortgage in Moscow when interest rates have risen substantially.
Millions of Russians like him are beginning to feel the effects of Western economic sanctions, which have been designed to punish the country for invading neighboring Ukraine.
“I am planning to find new clients abroad as soon as possible and move out of Russia with the money that was saving for the first installment”, indicates the industrial designer.
“Here I am afraid, people have been arrested for speaking against ‘the party line’. I feel ashamed and I didn’t even vote for those in power.”
Like others interviewed for this article, we do not use his full name or show his face for reasons of security. Some names have been changed.
Economic Warfare
The sanctions that are now hitting Russia are described as an economic war: they aim to isolate the country and create a deep recession there.
Western sanctions seek to provide support from Ukraine, which the Russian Army invaded last week.
Western leaders hope that Unprecedented measures produce a change in the thinking of the Kremlin.
Ordinary Russians face the anguish that their savings will disappear. Their lives are already being interrupted.
Sanctions against some Russian banks include cutting them off from systems such as Visa and Mastercard and, consequently, from Apple Pay and Google Pay.
Daria has 24 years and is a project manager in Moscow. These measures have meant that, for example, he had not been able to use the subway.
“I always pay with my phone, but it just didn’t work. There were other people with the same problem. It turned out that the barriers are operated by the VTB bank, which is under the sanctions and cannot accept Google Pay and Apple Pay”.
“I had to buy a metro card,” he told the BBC. “I couldn’t pay in a store today either, for the same reason.”
On Monday, Russia doubled its interest rate, raising it from 9.5% to 20%, in response to sanctions and after the ruble sank to new record lows.
The stock market remains closed amid fears of a sell-off in shares.
The The Kremlin says that it has enough resources to face the sanctions, but this is debatable.
“There are no dollars”
Over the weekend, the central bank called for calm amid fears of a bank run, which happens when too many people try to withdraw their money.
Paying for subway rides and shopping in stores is now more difficult for many Russians.
“There are no dollars, no rubles, nothing! Well, there are rubles, but I am not interested in them”, says Anton, who has little more than 20 years and was queuing at an ATM in Moscow.
“No I know what to do now. I’m afraid we’re turning into North Korea or Iran right now”.
Buying foreign currency costs the Russians 50% more than a week ago and that is if they can get it.
At the beginning of 1779, US$1 was quoted in about 75 rubles and 1 euro to 113. But the war helped set new records: at one point this past Monday, US$1 cost 113 rubles and 1 euro, 66.
For Russians, the ruble-dollar exchange rate has long been a sensitive issue .
In the decade of 1990, after the collapse of the Soviet Union, the dollar was the only strong currency in the that the Russians kept their savings: the safest bet was under the mattress.
When the government of President Boris Yeltsin defaulted on its debt in 1990, those who had been sleeping with their money they felt vindicated.
However, over the next decade, various central bank measures helped reassure Russians about the ruble.
Deposits placed in Russian currency began to grow and so did the amount of money that Russians invest in shares of Russian companies.
However, whenever there is uncertainty, Russians they always run to the nearest ATM to withdraw dollars.
This time it was no different.
“ Under the pillow”
As soon as the war broke out in Ukraine the 22 February, Russians flocked to ATMs, remembering the The lessons learned in previous crises.
Ilya, who has little more of 30 years, just finished paying off his mortgage in Moscow. He says he can’t move out “any time soon”.
“When the operation started in Donbas, I went to the ATM and took out the savings I had in dollars in Sberbank. Now I literally keep them under my pillow”.
“The rest of my savings are still in the banks: half in dollars and the rest in rubles. If things get worse, I’ll pull the lot. I’m scared because I foresee a wave of robberies. But these are the options that exist”.
4 keys to understanding the unprecedented sanctions imposed by the West to Russia
The end of pacifism in Germany and the neutrality of Sweden and Switzerland due to Russia’s invasion of Ukraine
Images on social networks have shown long queues at ATMs and exchange houses across the country in recent days, with people concerned that their bank cards may stop working or that limits will be placed on the amount of cash they can withdraw.
Dollars and euros began to run out a couple of hours after the invasion. Since then, very limited amounts of these coins have been available and there is a limit to the number of rubles that can be withdrawn.
Standing in a queue in Moscow, Evgeny, from 45 years old, said she wanted to withdraw money to pay her mortgage .
“Everyone I know is anxious. Everyone is stressed. I have no doubt that life will get worse. War is horrible”.
“I think all countries use double standards and now the ‘big countries’ are measuring the strengths of others, deciding which is better. And everyone is suffering”.
“Today is the first day I decided to withdraw money and I didn’t have any problems. I withdrew rubles just in case”, says Marat, who has 35 years.
“I’m not very good at forecasting, but I suspect our lives will get worse. Time will tell”.
A form
The problem of cash is not limited to Moscow: people have been running through Perm, Kostroma, Belgorod and other provincial cities to get dollars or euros, reports the BBC Russian Service.
Rubles are easier to get than dollars, but they are worth less than before.
An anonymous IT specialist even created a Telegram bot that automatically asks if there are euros or dollars in the ATMs of Tinkoff, a popular private bank, and if so, shares location with subscribers.
Many have tried to pre-order cash. vo through its banking applications, a feature of Russia’s advanced banking system.
Sunday night , when the sanctions against the reserves of the Russian Central Bank were announced, you could still use an app to ask for US$1 for up to 127 rubles and 1 euro for up to 150.
But on Monday, customers of Russia’s largest state-backed bank, Sberbank, told the BBC’s Russian Service that they couldn’t ask for cash through the app; they had to go to their office and sign a form to do so.
Banks deny that there is a shortage of liquidity, and analysts agree that a shortage of cash at ATMs is more likely automatic reflects an attempt to avoid a bank stampede.
The Kremlin has said that Russia expected these latest sanctions and that it is ready to face them, although it has not said if the companies will receive additional help, as happened during the pandemic.
Memories of 2014
But ordinary Russians, many of whom get their information from state-controlled television (which repeats many of the lines of the Kremlin), soon begin to notice differences in their lives.
In Sberbank, dollars must be ordered by signing a form in person.
Residents of Moscow are already reporting d e some queues at grocery stores when people buy products they think will be in short supply due to price hikes or trade restrictions.
Russian companies could end up cutting hours or slowing production as sanctions are imposed.
In addition to the drop in the value of their savings, Many Russians are expected to lose their jobs as the economy reels from being cut off from financial markets in the West.
For the Russians, all this brings back memories of what happened when President Putin annexed Crimea in 2014 and people queued for hours to get money at cash.
Exchange offices had to hastily buy new five-digit exchange rate boards when the old ones they ran out of space.
Back then, US$1 usually cost between 30 and 35 rubles, an unthinkable amount these days.
Additional information from Amalia Zatari,
of the BBC Russian Service in Moscow.
Remember that
you can receive notifications from BBC Mundo. Download the new version of our app and activate it so you don’t miss out on our best content.
Do you already know our channel of Youtube? Subscribe!
