If one bank decides it doesn’t want to deal with porn, fine. But when all the banks decide that, that’s very very bad. The cumulative effect is a chilling of protected speech in a way that congress could never legally get away with.
(As an aside, one sort of neat thing about CCBill is apparently they’ll never kill your account without warning, unlike PayPal & co)
Specifically, BNY Mellon, acting in an intermediary role between OnlyFans' banks and creators' banks, allegedly blocked all payouts to creators.
The problem is.. it is not exactly standardized as each bank does their own thing thanks to BSA rules.
Chase for instance
Even with 3dsv1 the liability doesn't always shift to the issuing bank. For example, I believe it is Mastercard NA(Might be Visa NA) that doesn't allow any 3ds liability shift for high risk merchants.
Source: Worked at payment processor in high risk processing +$1B in volume
1. It tries to gather more data points about the customer environment (i. e. browser and screen details). I think the goal is to provide more signals that the bank can use to decide low/high risk transactions. This likely feeds into...
2. Some transactions can be passed through in a "frictionless" manner. Instead of getting the "please log into your bank this is not phishing trust us" interstitial, it requires no interaction.
If most of the time, customers are sitting int eh 'frictionless" universe, then they won't hit too many situations that encourage cart abandonment.
Depending on the region, only a small fraction of payments are enrolled in the framework to do that validation / challenge anyway, it’s been expensive to adopt and a lot of card acceptors are still nervous about abandoned carts and lost revenue.
Aaaand that’s not to mention good old fashioned stolen cards, counterfeiting and at the other end, full-scale identity takeovers. Many security features are still bypassable by using the legacy system that should have been supplanted by now. It is a constantly-evolving (and frustrating) field.
There are some customers in the industry who run silly numbers like +10% and do "Mid burning" with different banks.
The highest CBs tended to be the "online dating space" or "find X nearby hookup" kind of sites.
If you've got any other questions feel free to ask.
Source: Worked at payment processor in high risk processing +$1B in volume
I expect the CB ratio to be 0.7% if they're aggressive with not leaving money on the table and refund anything that looks like it'll give them bad press. If they're they're trying to keep it as low as possible I've seen the ability to operate at 0.3%.
CCBill & Epoch when I want to shift high risk liability. Rocketgate for everything else. Getting the processor is the easy part, finding an acquirer and getting a mid is much harder.
I have no advice on how to find an acquirer/getting a mid for high risk it is very much networking and knowing people club.
You also need to deal with various combinations of acquiring (bank the merchant account linked to the specific payment network is with) and issuing banks (bank of the individual card owners)
People think this is about morality, but it's a lot more about the cost of operating in that market. I bet that there are way more claims of fraud, money laundering investigations, subpoenas and other overhead that the banks don't want to deal with.
Like teenagers stealing credit cards to pay camgirls is probably pretty common. And there are likely a lot of prostitution investigations.
The real problem is that sex work isn't treated like normal work, which just creates freedom for criminals to take advantage of vulnerable people.
If it was licensed and regulated, then it would be easier to tell the crooks, and victims of human trafficking from the people who are legitimate, voluntary workers.
Then the economics might make sense for banks to keep serving these customers.
A credit card for porn… good luck.
Any crypto-only platform that solves the problem of everyone needing a copy of the ledger and gains meaningful adoption will face the same legal, PR, and regulatory pressures as anything else in the same place.
On that note, the whole reliance on cards for on-line feels like a stupid hack that got way out of control. A card is just a physical access token for the account - it shouldn't be reused on-line like this. You should be able to generate per-payment tokens on demand instead. The whole mental model around online payments is bonkers - it's just taking the meatspace model and adding "but with computers!" to it, where it's the meatspace practices that are a kludge that digital doesn't need.
1) some banks/fintech offer virtual cards. For example, whenever I need to pay with credit card at a site that seems to be using some homegrown system I create a new virtual card in transferwise and destroy it right after.
2) I've seen banks offer virtual cards with CVC codes that change every 24h hours.
Cards make sense in meatspace, not on-line. Virtual cards are stretching the analogy already. Short-lived virtual cards are pushing it to the limits. What users need is the ability to generate single-use payment authorization tokens. Talking about "cards" carries too much irrelevant meatspace baggage; we've already worked out different, better-fitting abstractions for digital use.
Outdated/meat-space abstractions are useful for both driving adoption and getting laypeople to understand intuitively what you mean. And beyond that, most of us encounter dozens of them a day without blinking. Think about that the next time you check your electronic mail on your general-purpose computing device you call a "phone".
https://support.google.com/pay/merchants/answer/6345242?hl=e...
I agree with the other post that keeping meatspace terminology isn't bad. Offering a "Single use credit card" would be an easily understandable feature.
https://payid.com.au/ is gaining wide adoption in Australia. It seems like Australia has abandoned their homegrown payment rails (EFTPOS) in recent years and all bank cards are actually visa/mc. But maybe with PayId on phones this will change again.
https://www.europeanpaymentscouncil.eu/what-we-do/sepa-insta... is coming to Europe and hopefully will see similar adoption to PayID.
As mentioned often, America is behind the rest of the world by at least a decade but maybe they can leapfrog similar to developing markets.
[0] https://www.eftposaustralia.com.au/news/eftpos-has-started-c...
Someone else mentioned the future promise of FedNow. I'd expect that would be "any legal use is permissible" for legal reasons, but it can only replace debit payments at best. If you had a lender who worked atop FedNow, you'd reintroduce the problem of having a private party who is not legally obliged to serve all possible customers.
Checkout.com was most recently valued at $15 billion.
Anyone discussing this needs to be aware of "Operation Chokepoint".
The banks all doing the same thing is exactly what you would expect in a free market.
They are all in the same market (credit card processing) and all have the same information on the risks and costs and revenue in that market for handling various types of transactions. All of them that make rational decisions supported by the data they have should come to the same conclusions and take the same actions.
What you'd expect in a free market is for specialized banks to appear that would deal with porn and other high risk customers that the more general purpose banks all conclude that they don't want to deal with.
That's what has happened, as has been mentioned in other comments.
I think that's not quite what happened here. It's not that, literally, all the banks decided this; it's that the banks are so huge that, when one or a few of the mega-banks make the decision, it's effectively the same as if they all did. Ultra-consolidation is the real problem.
The Traci Lords case is a good illustration of this. One day everything is order, the next somebody realizes she used a fake ID and bam, everybody involved is suddenly manufacturing/profiting off/in possession of child pornography. Add in the massively lowered bar for OnlyFans/PornHub, where anybody with a phone can now DIY, and it's a legal minefield.
Yes, there are legal risks involved, but at the end of the day, the main reason why sex work gets hit so much harder than any other type of legal enterprise is because the people in charge see nothing to be gained by standing up for sex workers.
Just another reason to smash these banks into a million pieces.
Price increases are a great example. One company will take an increase and most follow.
And how is this chilling of protected speech? The constitution guarantees free speech, not payment for speech. There is nothing stop these workers from sharing their content/speech.
So how do you share things legally on the internet without involving a private business who can stop you?
Not necessarily. Banks have a government license to create money (ok, depends on what kind of bank, but let's put that aside), and provide services many individuals and organizations rely on. That already means that even if you're a staunch capitalist, you should still support some sort of set of constraints and norms, regulation, of their activities. So it's not clear that a bank should be able to refuse service to legally-operating organizations.
Plus, if one bank can do this, then why not any other bank?