Russia moved quickly to correct an overbroad application of its counter-sanctions rules that had restricted access to some foreign individuals’ bank deposits.
Presidential Decree No. 377, signed on June 1, 2026, extended the special settlement regime for certain foreign creditors to bank deposits; several banks read the brief amendment conservatively and restricted even relatively small balances belonging to foreign nationals of states Russia classifies as “unfriendly.”
The Bank of Russia narrowed that interpretation on July 14, and Presidential Decree No. 550 went further on August 4 by excluding foreign individuals’ deposits from the regime altogether and allowing eligible customers to recover rubles that banks had transferred to restricted Type C accounts.
Completed in 64 days, the two-stage correction offers concrete, though limited, evidence that Russian authorities were willing to reverse regulatory overreach when it caught ordinary foreign savers.
How a narrow amendment produced broad restrictions
Presidential Decree No. 95 of March 5, 2022, established a temporary procedure for Russian debtors to discharge certain obligations to foreign creditors connected with “unfriendly” states. Where the relevant obligations exceeded 10 million rubles in a calendar month (approximately US$119,000), the debtor generally had to pay in rubles through a Type C account unless a competent authority permitted another form of settlement.
Decree No. 377, signed and effective on June 1, 2026, added bank deposits to the obligations that the framework covers. The amendment was extremely concise and did not explain how banks should apply the 10 million-ruble threshold to their depositors. It also drew no express distinction between corporate depositors and private individuals, or between a deposit agreement and other types of bank accounts.
Faced with that ambiguity, banks adopted different interpretations, many of them highly conservative. Customers of the largest banks, including Sberbank, T-Bank, Alfa-Bank, and VTB, reported restrictions on RBC. Some said they had been unable to close deposits, transfer the money to another account, or withdraw it in cash.
In some cases, restrictions reached deposits holding less than 1 million rubles (approximately US$11,900). Banks were treating the 10 million-ruble threshold as an aggregate limit across all affected foreign customers rather than a separate threshold for each depositor.
The impact extended beyond conventional foreign investors. Reported cases included holders of highly qualified specialist permits, participants in the Shared Values Visa program, and ethnic Russians still completing the documentation needed to return from “unfriendly” states. For people already living in Russia, access to a deposit could be a household-liquidity issue rather than an investment question.
Ruble deposits also paid well. In mid-June, average maximum rates at Russia’s ten largest deposit banks ran between 12 and 15% depending on maturity, while the best offers at smaller banks exceeded 20%.
A Type C account does not amount to a formal confiscation of the money, but its permitted uses are narrow. For most everyday purposes, the holder cannot withdraw funds credited to such an account in cash, send them abroad, or use them freely to pay for goods, services, and ordinary debts. That practical effect explains why affected customers described the banks’ actions as a “freeze.”
The first response: The Bank of Russia narrows the rules
RBC first reported the complaints on June 27. On July 2, Bank of Russia Governor Elvira Nabiullina said the regulator was considering guidance so that the recent changes would be clear and understandable to banks. On July 14, 12 days after those remarks, the central bank issued Official Clarification No. 1-OR.
The clarification resolved four central questions. First, Decree No. 95 applied to obligations under bank-deposit agreements, not to ordinary bank-account agreements, including correspondent accounts. That distinction meant the deposit restrictions should not reach a current account, or an interest-bearing savings product legally structured as a bank account, merely because it earned interest.
Second, the special procedure did not apply before the bank’s obligation to repay the deposit or pay interest had fallen due. A bank therefore could not reclassify an existing, unmatured deposit as a Type C deposit in advance. Third, the decree did not prohibit extending or amending a deposit agreement, although any interest payment falling due still had to comply with the applicable rules.
Fourth, and most consequentially, the Bank of Russia said a bank must calculate the value of its obligations separately for each depositor in each calendar month. That instruction rejected the most expansive interpretation, under which a large bank could exceed the 10 million-ruble threshold merely by aggregating what it owed to all affected foreign customers.
The clarification immediately reduced the risk that small personal deposits would fall inside the regime solely because of the size of a bank’s overall foreign-client business.
Guidance from the central bank mattered, but it was not yet a complete solution. It clarified which products, dates, and customers the regime covered; it did not fully exempt private foreign depositors or, by itself, release money that banks had already credited to Type C accounts.
The second response: A presidential exemption and a route to recovery
Three weeks after the central bank’s formal clarification, the president changed the rules themselves. Presidential Decree No. 550, signed and effective on August 4, excluded bank deposits held by individual foreign creditors from the temporary settlement procedure in Decree No. 95. Branches, permanent representative offices, and other qualifying subdivisions of foreign organizations also fall within the exemption, where those units carry Russian registration.
Decree No. 550 addressed the transition period as well. It expressly entitled eligible individuals and Russian-registered foreign business units to receive, in rubles, money that banks had credited to Type C accounts between June 1 and August 4. That provision did more than prevent future restrictions: It created a legal route for reversing the consequences of the earlier application.
From the original amendment on June 1 to the final correction on August 4, 64 days elapsed. Four days after RBC’s report, the central bank’s governor acknowledged the need for clarity. A formal interpretation followed 12 days later, and a full presidential-level exemption, including a mechanism for recovering affected rubles, followed 21 days after that.
Part of a broader effort to attract new foreign capital
The deposit correction also fits a broader policy aimed at making new foreign investment more workable. Presidential Decree No. 436 of July 1, 2025, introduced special “In” accounts for foreign investors bringing new money into Russia. Reuters reported that the framework allowed new investment in rubles, foreign currency, shares, and bonds, and included withdrawal guarantees.
The Bank of Russia subsequently set the operating rules for In accounts. Under those rules, investors may use new foreign funds for bank deposits, exchange-traded securities, initial public offerings, and exchange-traded derivatives.
Alongside that, the regulator lifted domestic foreign-currency purchase restrictions for investors from “unfriendly” states who enter under the new framework.
An investor who already holds a Type C account may open an In account, but only with new funds. Existing restricted Type C assets do not automatically become eligible for transfer. Taken together, the In-account framework and the August 2026 deposit exemption suggest a deliberate policy distinction between legacy assets still under counter-sanctions controls, on the one hand, and new investment and ordinary private deposits, on the other.
A separate route also exists for legacy Type C balances. Russia’s currency control law, Federal Law No. 173-FZ, treats a foreign citizen who holds a Russian residence permit as a currency resident, and the Bank of Russia has confirmed that such people are not foreign creditors under Decree No. 95. Once the bank holds that documentation, the holder can close the Type C account and move its balance to an ordinary account.
For qualifying investors, Russia’s investor-residence program, commonly called the Russian Golden Visa, offers a direct mechanism for obtaining that permanent residence status without first holding a temporary residence permit. Holders who take that route can therefore also unlock funds sitting in a Type C account.
A narrow but meaningful signal
Within 64 days, the Bank of Russia narrowed the banks’ expansive interpretation, and the president then exempted foreign individuals’ deposits and authorized eligible customers to recover rubles that banks had transferred to Type C accounts between June 1 and August 4.
The speed and seniority of that response stand out given the ongoing geopolitical conflict and the many urgent demands competing for the Russian government’s attention.
Only a comparatively small number of foreign private depositors felt the restrictions, yet the issue moved rapidly from individual banking complaints to a formal central-bank clarification and, ultimately, a presidential-level correction. That high-level attention signals that foreign residents and investors are a policy priority, and reaffirms the Russian leadership’s commitment to attracting and retaining both foreign capital and people.
