Ukraine crisis: Russia bans residents from transferring money abroad as Ruble crashes

Amid economic sanctions imposed on Moscow by the West, Russian President Vladimir Putin on Monday ordered a ban on foreign exchange loans and transfers by Russian residents to outside of the country. This is a desperate measure to prop up the Ruble which has plummeted in value as a result of Western sanctions over Russia's invasion of Ukraine. 

A decree signed by Putin also said that exporters would be required to hold at least 80% of revenue in Rubles in a move to prop up the Russian economy. Sanctions imposed by the West has impacted Russia hard with the Ruble falling to a record low and the central bank more than doubling its key interest rate to 20%.

This means big groups such as energy giant Gazprom would have to buy the currency.  Earlier, President Putin held an important meeting with the Prime Minister, Finance Minister and the head of the country's biggest private bank, Sberbank, and the central bank.

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Earlier, Kremlin spokesman Dmitry Peskov told that the sanctions by West on Russia were hard, but their country has the necessary potential to compensate the damage. It has been reported that Russia has about USD 630 billion in reserves - a stockpile of savings built up from soaring oil and gas prices.

For waging a war against Ukraine, the West has punished Moscow by freezing Russian banks out of the international financial system and limit the ability of the Russian central bank to use its reserves to help prop up the ailing national currency.

The United States has banned all transactions with Russia's central bank and has frozen its reserves. Switzerland on the other hand also said it would adopt the same measures announced by the EU during the weekend. The huge devaluation of the ruble would be expected to fuel inflation in Russia.

(With Agency Inputs)