Since the beginning of Russian aggression in Ukraine on 24 February 2022, the cross-border payments from Russia to Estonia decreased by 18% (to 92.6 million euros in May 2022) and payments from Estonia to Russia decreased by 40% (to 72.9 million euros). The volume of cross-border payments with Belarus is modest and decreasing.
The volume of large cross-border payments has increased with many countries, including United Arab Emirates, Armenia, China, Turkey, Georgia and Uzbekistan, which are reported as contributing to sanction evasion according to FinCEN.
“Reports submitted to the Estonian FIU, majority submitted by Estonian credit institutions, do not illustrate remarkable sanction evasion through those countries. A few deviations in cross-border payments, and trade flows indicate that,“ said Toomas Plaado, Head of the department of strategic analysis from the Estonian FIU. „As the trends will be emerging over a longer period of time, the FIU will continue to monitor the overall picture of these countries in the future as well,“ Plaado added.
The volume of large cross-border payments by e-residents did not change in the early months as of April 2022. The volume of large cross-border payments (over 10,000 euros) of several companies of Russian citizens engaged in the wholesale of motor fuel and the manufacturing of iron, steel and ferro-alloys and the wholesale of electrical materials, etc., increased several times.
There were no drastic changes in the number of the Russian customers of VASPs with an Estonian authorisation. Russian customers accounted for about 12% of the 52 VASPS serving them most. The turnover of the services mediated to Russian customers decreased by nearly 80% to 3.7 million per week at the end of May mostly due to a single service provider.
During the first weeks of the war, the demand for cash in Estonia increased three times, returning the back to the pre-war level. The balance of the deposits of Russian persons (households and companies, except financial companies) at Estonian credit institutions has sharply decreased: from 83 million euros in February to 53 million euros in June. For Belarusian persons, from 15 million euros in February 2022 to 3 million in June.
„People are probably using cash as a crisis reserve. Also we see an increase in declared cash exportation primarily for personal needs on the Estonian-Russian boarder,“ said Toomas Plaado.
Valid financial sanction forbids the exportation of euros and bank notes denominated in the official currency of the Member States to Russia for other than personal needs.
The report about changes in the trade flows and application of financial sanction relies on data from the Estonian FIU, Financial Supervision Authority, Police and Border Guard Board, Bank of Estonia, and Tax and Customs Board.
The report is available in Estonian, summary in English: https://fiu.ee/aastaraamatud-ja-uuringud/uuringud#muutused-rahavoogude
