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Australian foreign exchange platform OFX has come under fire for abruptly cutting off payments to Ukraine, putting a barrier in front of foreign start-ups paying wages to their staff in the country when they need cash most.
Brad McEvoy, co-founder of loyalty program start-up Kademi, said he was furious at OFX, which was formerly known as OzForex, for blocking payments to his Ukrainian workers when some had been forced to flee their homes.
Many Ukrainians, such as these residents of Irpin, have been forced to flee the violence of the Russian invasion.Credit:Getty Images / Chris McGrath
“You expect a level of integrity, don’t you, from Australian companies, and they have done the exact opposite,” Mr McEvoy said.
The international community has worked in lockstep to introduce some of the most punitive sanctions in history to hobble the Russian economy following the country’s invasion of Ukraine. Focussed on people and companies involved in the war, the sanctions have made the payments environment more complex.
The Australian government has also applied sanctions to regions of Ukraine controlled by Russia and its proxies including Donetsk and Luhansk in the country’s east.
In emails seen by The Sydney Morning Herald and The Age, ASX-listed OFX’s Australia and New Zealand head Michael Judge offered his sympathies to people living through the crisis but confirmed OFX was blocking payments to non-sanctioned areas of Ukraine.
“OFX reasonably expects the number and complexity of sanctions related to Ukrainian destined payments to grow,” Mr Judge wrote last week. Some of its banks had blocked payments into Ukraine too, he said. “The decision [to suspend payments] is temporary, one linked to the heightened level of risk we believe OFX and its clients currently face should any sanctions inadvertently be contravened.”
Kademi, which is based in New Zealand, has several workers in Ukraine, who it had been paying through OFX for years before being barred last week. Mr McEvoy has since paid the staff via another provider, Wise, and other start-ups confirmed their payment services were still operating.
One of Mr McEvoy’s workers has had to flee his home in Kyiv, the capital that is increasingly encircled by Russian forces, sending his family to Poland while staying in Lviv in Ukraine’s west. Another has armed himself and had his younger daughter sheltering in the bathtub to protect her from any bombardments.