Money transfers from Russia to Georgia fall to their lowest level since 2004 after restrictions on Zolotaya Korona

In August, personal remittances from Russia to Georgia dropped to $5.1 million, the weakest reading in the National Bank of Georgia’s data since 2004. Transfers in the opposite direction fell to zero for the first time on record, and the bank tied the move to restrictions on the payment system Zolotaya Korona.

1. According to RBC’s review of National Bank of Georgia statistics, Russia fell from third place in July to 11th place in August among countries sending money to Georgia. The top 10 by transfer volume were the US, Italy, Germany, Greece, Israel, Turkey, Spain, Kazakhstan, the UK and France.
2. The contrast with recent months is sharp: transfers from Russia to Georgia were $42 million in July and $51.4 million in June. Since the start of 2022, they had not fallen below $25 million in any month, and in some months they exceeded $300 million.
3. Money transfers from Georgia to Russia also hit zero in August. That was down from $3.7 million in July and $4.3 million in June, according to the same statistics.
4. The National Bank of Georgia linked the decline to restrictions against Zolotaya Korona. The operator and settlement center of the system, RNKO Payment Center, was added to the EU sanctions list at the end of July, as part of the EU’s 21st sanctions package against Russia, which targeted the energy, financial and crypto sectors and froze assets and banned transactions for 94 Russian banks.
5. KoronaPay Europe Limited, the European arm of Zolotaya Korona, then announced in August that it was leaving the European market and starting the process of withdrawing its license. New transfers through KoronaPay Europe are no longer available, while users can return previously sent funds through the Korona app. The service launched in 2020 in 31 countries: all EU member states, the UK, Norway, Iceland and Liechtenstein.