Xsolla defends itself after being called out by Ukraine for ties to Russia

Game payments firm Xsolla has defended itself for its reduced presence in Russia after a Ukraine government minister called the company out for its ties to Russia.

Last week, Ukraine’s Mykhailo Fedorov, minister of digital transformation, asked gaming companies such as Epic Games, Valve and Ubisoft to stop working with Xsolla for its Russian ties. Ukraine has advocated a “digital blockade” of Russia for its invasion of Ukraine, and it has asked more than 600 companies to stop doing business in Russia and supporting the Russian military machine.

Chris Hewish, interim CEO at Xsolla, said the company does have an office in Russia but it has reduced its presence there. He first spoke to Axios about this, and the Ukraine minister evidently picked up on a report about Xsolla by AIN Capital in September.

Hewish noted that Xsolla, which has nearly 1,000 employees around the world, was founded in Russia but has been incorporated in the U.S. for years and so should be considered an American company. He said that since the war began, Xsolla has reduced its presence in Russia by 200 people.

When Xsolla announced it was closing an unused holding company, others interpreted that to mean that it was pulling out of Russia. Hewish said he could see how that resulted in confusion after others found that it was still in Russia. But that closure was not meant to imply that it had pulled out altogether.

Hewish confirmed that in March 2022, Xsolla donated $100,000 to the Red Cross for relief to civilians in Ukraine. Xsolla provides for transactions for gamers in Russia and leaves it up to its clients as to whether to allow those transactions. So far, Hewish said clients have not canceled after the Ukraine minister’s tweet. Most international companies operating in Russia have not pulled out entirely.

Disclosure: Xsolla is a sponsor for GamesBeat events.