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Insights / Cross-border & currency control
tw.
Cross-border · 4 min
Updated February 2026
taxwellpartners.com/insights/bank-guarantee-letter-of-credit-russia.html

Bank guarantees and letters of credit Russia 2026: trade finance

Bank guarantees and letters of credit in Russia 2026: available instruments, CNY/TRY corridors, customs guarantees and participating banks.

tw.

Trade finance instruments — bank guarantees and letters of credit — remain available in Russia in 2026, but the correspondent banking landscape has changed significantly since 2022. Understanding which instruments are accessible through which banks, and how cross-border mechanics work given restricted USD/EUR correspondent channels, is essential for companies importing to or exporting from Russia.

Bank guarantees in Russia

Types and applications

Russian banks issue bank guarantees (банковская гарантия) under both Russian Civil Code provisions and international UCP 600/URDG 758 rules, depending on the underlying contract and counterparty requirements.

Customs guarantees: specific requirements

Customs guarantees are among the most common trade finance instruments for foreign companies importing into Russia. The Federal Customs Service accepts bank guarantees (from FCS-accredited banks), insurance guarantees, and cash deposits as security for deferred duty payment and temporary importation procedures.

Guarantor bank must be on the FCS-approved list — not all non-sanctioned banks qualify

Guarantee amount must cover 100% of customs duties and taxes on the guaranteed goods

Validity must extend at least 30 days beyond the deadline for completing the customs procedure

Demand payment mechanism: the FCS can demand payment without presenting proof of breach — the guarantee is on-demand, not conditional

Letters of credit for Russia trade

Documentary credits (L/C): current availability

Documentary credits for Russia trade require a correspondent banking chain that can process the underlying currency. The post-2022 landscape:

CNY-denominated L/C: Most available. Chinese banks can issue and confirm L/Cs for Russia trade without USD/EUR correspondent banks. CIPS provides the clearing infrastructure. Growing volume for China-Russia and China-Russia-third country trade

USD-denominated L/C (non-sanctioned Russian banks): Technically available but confirming bank is difficult to find. Most Western banks will not confirm L/Cs involving Russian banks regardless of sanction status. UAE, Turkish and some Asian banks can sometimes confirm

EUR-denominated L/C: Significantly restricted. The correspondent bank requirement creates effective barriers for most transactions

TRY-denominated L/C: Available for Turkey-Russia trade through Turkish banks with Russian correspondent relationships

Issuing bank selection

For imports into Russia, the Russian importer's bank issues the L/C. Key banks for Russia import L/Cs in 2026: Gazprombank (partially sanctioned — check specific restrictions), Alfa-Bank, Raiffeisen (limited), regional non-sanctioned banks. The issuing bank's correspondent network determines which currencies and counterparty countries the L/C can cover.

Confirmation and advising

Foreign exporters to Russia who require confirmed L/Cs (where a bank in the exporter's country adds its guarantee) face the most significant constraint. Most European, US and UK banks will not add confirmation to Russian bank L/Cs. Available confirmation banks are predominantly in UAE, Turkey, China, Kazakhstan and Armenia.

Practical approach for Russia trade finance

Given the current constraints, foreign companies trading with Russia typically use one of three approaches:

Currency-led structure

Design the trade finance instrument in a currency that has a working clearing channel for Russia — CNY or TRY for most transactions, AED where UAE banks are involved on both sides. The choice of currency determines the available instrument types and participating banks.

Third-country intermediary

Trade routes through an intermediary entity in Kazakhstan, UAE or Turkey, where the intermediary issues or receives the trade finance instrument using its own non-restricted banking relationships. Adds structural cost but expands instrument options significantly.

Open account with payment guarantee

Where L/C confirmation is unavailable, open account trading with a Russian bank guarantee (on-demand, issued by a non-sanctioned Russian bank with correspondent capacity in the relevant currency) provides the exporter with security without requiring Western bank involvement.

Trade finance for Russia is available in 2026 but requires more active structuring than pre-2022. The currency choice — which should be made first — determines the rest of the structure. CNY-denominated instruments through Chinese banks provide the widest coverage for Russia trade. For non-China counterparties, UAE and Turkish banking relationships are the most productive starting point.

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