What Sanctions Mean for Financial Access and Cross-Border Payments

Introduction

When a major sanctions bill makes headlines — as the July 2026 US Senate Russia sanctions proposal did, trending as “Katie Britt” — the focus is often on geopolitical strategy. But sanctions are fundamentally financial instruments. They work by restricting access to payment systems, freezing assets, and cutting off bank relationships.

This article explains how economic sanctions affect financial access, what the data shows about the resilience of financial systems under sanction pressure, and where the most vulnerable points in global payment infrastructure lie.

How Sanctions Target Financial Systems

International sanctions typically operate through three layers:

1. Correspondent banking. When a country is sanctioned, its banks lose access to correspondent banking relationships with major international banks. This cuts off the ability to process cross-border payments in major currencies. For individuals, this means money transfers — including remittances — become slower, more expensive, or impossible.

2. Payment networks. Sanctions can restrict access to global payment networks like SWIFT for financial messaging or Visa/Mastercard for consumer payments. When a country’s banks are cut from SWIFT, international wire transfers must find alternative channels. For consumers, this limits where and how they can use payment cards abroad.

3. Capital markets. Restrictions on sovereign debt issuance, foreign investment, and access to international capital markets limit a country’s ability to finance trade and economic development.

Financial Inclusion as a Resilience Indicator

Countries with higher levels of financial inclusion — measured by account ownership, digital payment adoption, and mobile money penetration — are better positioned to adapt to payment disruptions. The reasoning is straightforward: when a country has a well-developed domestic payment infrastructure, citizens and businesses can continue to transact even if international channels are restricted.

Account ownership is the foundation. In Estonia, 98.9% of adults have an account; in Lithuania, 99%. These countries have robust domestic banking systems that can function independently of international payment networks. In Georgia, by contrast, account ownership stands at 78.8%, creating more vulnerability for households that rely on cash-based transactions.

Digital payment adoption determines how easily domestic transactions can shift away from cash. The United Kingdom (99.2% digital payment adoption) and Czechia (94.1%) have near-universal digital payment capability. For a broader comparison of how countries differ in digital transaction infrastructure, see the mobile money transaction ecosystem.

Mobile money plays a unique role in countries where traditional banking is limited. Turkiye has 23.3% mobile money account penetration, and Armenia has 17.4% — meaning a significant share of the population already uses mobile-based financial services that may operate on different payment rails than traditional banks.

Remittance Corridors Under Pressure

The human impact of financial sanctions often shows up most clearly in remittance flows. Migrants sending money home depend on low-cost, reliable cross-border payment channels — exactly the kind of infrastructure sanctions can disrupt.

When correspondent banking relationships are broken, remittance fees tend to rise and processing times lengthen. For countries where remittances represent a large share of GDP, this can have direct effects on poverty and household welfare.

Countries bordering sanctions targets are particularly exposed. They often serve as transit corridors for redirected payment flows but also face increased compliance costs and de-risking by international banks. For a ranking of the economies most dependent on remittance income, see where remittances matter most.

What the Data Can and Cannot Tell Us

The World Bank Global Findex and WDI datasets provide valuable baseline measures of financial access, but they have important limitations for sanctions analysis:

Lag time. The most recent Findex data is from 2021 and 2024 — pre-dating many current sanctions regimes. The full effects of the latest sanctions will only appear in future survey rounds.

No real-time monitoring. Account ownership and digital payment adoption are structural indicators that change slowly. They can show a country’s capacity to withstand payment disruption, but they cannot show whether specific payment corridors remain open today.

No projection available. Financial inclusion indicators have no forward-looking projections. Analysis of sanctions impacts on financial access is inherently backward-looking.

What the Index Cannot Tell You

Three important limitations of financial access data in the context of sanctions:

Aggregation masks variation. National account ownership data hides important differences. In Russia (79.3% account ownership), access may vary substantially between Moscow and rural regions, and between sectors of the economy that are and are not directly targeted by sanctions.
Access is not usage. Having an account and being able to use it for international transactions are very different things. Even in countries with near-universal account ownership, international payment restrictions can prevent cross-border use of those accounts.
Compliance costs are invisible. The cost to financial institutions of maintaining sanctions compliance programs does not show up in account ownership or digital payment metrics, but it affects the availability and price of cross-border payment services.

Sources & Method

Data on account ownership, digital payment adoption, and mobile money accounts comes from the World Bank Global Findex survey, the world’s most comprehensive dataset on financial inclusion, covering more than 150,000 adults in over 140 economies. Banking sector indicators (nonperforming loans, capital adequacy) come from the World Bank’s Financial Development and Structure database. Remittance data comes from the World Bank’s Migration and Remittances team, drawing on IMF Balance of Payments statistics.

For full details on our methodology and data sources, see the methodology page.

For related reading: