Will loans be wiped out and money disappear from accounts: what will happen if Ukraine destroys Russian banks’ data centers?
Kyiv • UNN
An expert explained what consequences attacks on Russian banks’ data centers could have for Russia’s banking system and economy.
Let us imagine that a client of a Russian bank opens the app, but it does not work. It is impossible to check the balance or transfer money. Payment by card is declined in a store, while businesses cannot settle accounts with suppliers. Now let us imagine that this is happening not at one bank, but simultaneously at several of Russia’s largest institutions after systematic strikes by the Ukrainian Defense Forces. Could such a scenario paralyze the banking system of the aggressor country, and will the Russian economy withstand it? UNN examined the issue together with economic expert Andriy Novak.
Details
Recently, the Defense Forces used FP-1 drones manufactured by the Ukrainian defense company Fire Point to strike a mega-data center of Russia’s "Sberbank" in the city of Balakovo, Saratov region, Russian Federation. According to OSINT analysts, it is a large-scale complex for storing and processing information, intended to ensure the operation of banking IT systems and digital services. After the strike, users in various regions of Russia reported that they could not open online banking, access the website, or make payments. In addition, propaganda media began talking about risks to clients’ money and raised the issue of withdrawing cash.
As economic expert Andriy Novak explained, if attacks on banks’ digital infrastructure are repeated and facilities belonging to other major financial institutions are hit, the consequences could go far beyond temporary problems with banking services. Among other things, this could significantly aggravate the problems of the Russian banking system.
I would look at this not only from the perspective of temporary disruptions in banking applications or the inability to make a particular payment. This concerns a potentially much deeper problem—the disruption of the digital infrastructure on which virtually all banking activity now depends. The Russian banking system is already under serious economic pressure due to the war, sanctions, rising financing costs, and other macroeconomic problems. If systematic damage to digital infrastructure is added to this, it will create additional risks to the stability of banks
Andriy Novak stressed that a data center is not simply a building filled with servers. It is infrastructure that ensures the storage, processing, and access to vast amounts of information necessary for banks’ operations: from account and deposit data to credit histories and financial transactions.
Of course, not all of this data is necessarily stored in one place, and large banks usually have backup systems. But if damage to the infrastructure leads to the loss of access to critically important data or disrupts the operation of the systems that process it, the consequences may go far beyond an ordinary technical failure
If a bank loses access to critically important data about deposit holders, credit obligations, and the history of financial transactions, this could complicate customer service and the processing of payments.
If a bank loses access to the relevant data, this does not mean that clients’ money automatically disappears or that their rights are canceled. In large financial institutions, information is usually duplicated, and transactions may be recorded in several systems. However, even a temporary inability to access the necessary information can complicate customer service, payment processing, and the verification of individual transactions. And if both the primary and backup systems are damaged, recovery may be considerably more difficult and take much longer
Thus, for ordinary Russians, the most tangible consequence may not be losing their money, but being unable to use it for some time. A person will not be able to pay for a purchase by card, transfer funds to relatives, or make an urgent payment. If the problems continue for a long time and affect a significant part of the banking infrastructure, this could already influence economic activity.
What will happen when Ukrainian strikes affect several banks?
One bank can restore operations after a technical failure or use backup systems. But if strikes on data centers are repeated and affect other major Russian banks, the consequences could be more extensive.
According to Andrii Novak, financial institutions are interconnected through payment infrastructure, interbank settlements, business lending, and the financing of various sectors of the economy. Therefore, serious disruptions to the operations of one systemically important institution can create difficulties for its clients and counterparties, as well as increase the burden on other banks.
Let us imagine that a large Russian company is unable to make a payment on time because of problems at the bank servicing it. It delays settling accounts with a supplier, which cannot pay its partners on time, and they, in turn, postpone other payments. Thus, a technical failure can gradually develop into a problem for the real sector of the economy.
If such disruptions affect several major banks simultaneously, the risks to businesses and the financial system increase
At the same time, much will depend on how well the banks have prepared for such scenarios. The availability of independent backup data centers, data copies, alternative communication channels, and well-practiced recovery procedures can help avoid a prolonged shutdown. However, redundancy requires ongoing maintenance and does not guarantee protection against all possible problems.
Will Russians rush to withdraw cash?
Constant reports of disruptions at major banks may affect not only the availability of financial services but also people's trust in the system. If Russians regularly encounter problems when making transfers or paying for purchases, some of them may decide to withdraw cash or transfer their savings to another bank.
This, in turn, may create additional pressure on financial institutions. Especially if technical disruptions occur against the backdrop of other economic problems and doubts about the stability of banks.
Some depositors may decide to withdraw cash or transfer their money to another institution, even if their own bank has not been directly affected. This could create additional pressure on the liquidity of the banking system. If, at the same time as the technical problems, the banks' overall financial condition deteriorates, the risks of panic among depositors may increase
However, as the expert added, mass cash withdrawals are not an inevitable consequence of such attacks. For a banking panic to arise, several factors usually have to coincide: a loss of confidence, doubts about the banks' solvency, limited access to funds, and an insufficiently convincing response from the regulator.
Will the Russian economy withstand systematic strikes?
According to Andrii Novak, the Russian banking system is already under serious economic pressure because of the war, sanctions, rising financing costs, and other macroeconomic problems. Regular damage to digital infrastructure may intensify these difficulties, forcing banks to spend additional funds on restoring systems, repairing equipment, and maintaining backup capacity.
At the same time, there is a major difference between disruptions to the operation of individual banking services and the collapse of the entire banking system. Even in the event of serious failures, banks may restore operations and use backup systems, while the central bank of Russia may provide liquidity and introduce anti-crisis measures.
Theoretically, such a scenario is possible if serious technical problems coincide with financial difficulties, a loss of depositors’ confidence, and liquidity problems… At the same time, the economic impact of such damage should not be underestimated. The banking system is one of the mechanisms through which the entire economy functions. It enables settlements between enterprises, lending, the payment of salaries, trade financing, and the servicing of public and private financial flows. If its operations are systematically disrupted, this could increase business costs, delay payments, worsen access to financing, and reduce economic activity. On a national scale, such problems could amplify the negative consequences of other economic shocks
A separate aspect is Russia’s ability to finance the war. Economic weakening may limit the resources available to the Russian authorities for military needs. However, as Andrii Novak notes, it cannot be claimed that strikes on economic infrastructure will automatically lead to the cessation of hostilities or the collapse of the state.
The Soviet Union, for example, collapsed amid a deep economic and political crisis, but it would be an oversimplification to explain its collapse solely in economic terms. Likewise, it cannot be claimed that the Russian Federation will necessarily collapse as a result of strikes on its economic infrastructure. However, systematic economic pressure, restrictions on access to technology, problems with export revenues, and rising costs of the war may reduce the resources available to the Russian authorities for financing military needs
Therefore, systematic strikes on the data centers of Russian banks will not necessarily lead to the immediate collapse of the financial system. But if they cause prolonged disruptions in the operations of several major institutions, the consequences may be felt by ordinary customers, businesses, and Russia’s economy as a whole. The key factor will be whether banks can quickly restore their infrastructure each time and maintain the continuity of financial operations.