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While the sanctions being levied on Russia is to serve as a deterrent to Putin’s government, the aftermath is bound to be picked up by the masses who will directly suffer from the economic isolation.
American multinational financial technology company PayPal Holdings Inc (NASDAQ: PYPL) has stopped accepting new user registrations in Russia. As a spokesman told Reuters, this new move is a complement to the list of sanctions the company is levying on the country for attacking Ukraine on February 26 to date.
PayPal is one of the global payments platforms and it allows Russians to make cross-border transactions, with the halt in new users registrations, the Russians are further severed from the list of options available for global transactions. Prior to this particular move, PayPal has already restricted some Russian users as well as banks in compliance with sanctions from the United States and other Western countries amidst the escalating diplomatic ties.
While PayPal seems to be doing its best, Ukrainian authorities are obviously demanding more from the Palo Alto-based company. Speaking to Reuters in an interview yesterday, Ukraine’s deputy minister for digital transformation Alexander Bornyakov wants PayPal to shut down its operations entirely in Russia.
“If PayPal supports democratic values, it should go out from Russia,” he said
While many companies, particularly in the digital payments ecosystem like Mastercard Inc (NYSE: MA) and Visa Inc (NYSE: V) have already taken a proactive measure to halt their services in Russia, a host of others like British digital bank, Revolut is yet to follow suit. It is not out of place for a number of organizations to share a similar position like Revolut which believes Russian residents are as much a victim to this crisis as those in Ukraine.
While the sanctions being levied on Russia is to serve as a deterrent to President Vladimir Putin’s government, the aftermath is bound to be picked up by the masses who will directly suffer from the economic isolation. Even though PayPal and Revolut may eventually join the list of organizations that have absolutely put a peg on their services in the country amidst this war, Russians are billed to continuously find ways to bypass the sanctions and create an avenue for survival.
PayPal Holdings Will Not Fund Firearms and War
One of the major goodwill the Ukrainian government has earned with the public is the support for its military’s defensive actions against the Russian fleet. The Ukrainian government has been soliciting aid from both organizations and individuals, including PayPal.
While the letter from Ukraine to PayPal as seen by Reuters is centered on helping the country’s military, the company has a policy that bars it from funding weapons and firearms. With PayPal noting that it is still figuring out the implications of the sweeping sanctions on Russia, it said it has been instrumental in facilitating cross-border transfers through its Xoom service.
“Since this crisis began, PayPal has actively worked to enable donations to non-profit fundraising efforts in support of Ukrainian humanitarian relief efforts,” the company said in a statement.