Because having an "OnlyFans Bank" to underwrite the "OnlyFans Mastercard" wouldn't accomplish anything because the credit-card _network_[1] was also getting more restrictive about the adult content rules.
The major separate entities in the chain of making credit cards work:
- processors, gateways: e.g. early PayPal, Stripe,
- payment networks: e.g. Mastercard, Visa
- merchant banks: e.g. Wells Fargo Merchant Services, Worldpay
Getting transactions rejected by any of those 3 middlemen would be a showstopper for many businesses. If heightened fears about child pornography and sex trafficking causes all 3 financial layers to crack down with stricter rules, it would be impossible for most businesses like OnlyFans to overcome it.
So being your own bank to get around Wells Fargo Merchant rules doesn't solve the issue for Mastercard's rules unless you're willing to create a new payment communications network and convince millions of consumers to apply for a new credit-card using that unfamiliar network. It's not impossible as Discover Card and American Express did it but even they don't have the wide acceptance of Mastercard/Visa.
[1] Mastercard _network_ cracking down on adult content: https://www.mastercard.com/news/perspectives/2021/protecting...
People will do a lot for good porn.
It is conceptually possible for an adult entertainment website to sidestep the payment processors by clearing directly through ACH or an EFT network or something, but this is high risk for the bank offering the service (ODFI) and so access to ACH clearing is generally more difficult to obtain than merchant banking. Banks are not really any more willing to work with adult entertainment than credit card networks, and some of the material problems that make credit card networks hesitant (unusually high levels of chargebacks and use of stolen card information) are even bigger problems for ACH/EFT/etc. which are "less reversible" than credit card payments.
The ease of processing credit cards today is sort of a newer invention - you used to have to fill out an application and usually meet with a banker for an interview to get approval to open a merchant account, because the bank that offers the account is taking on risk on your behalf. Newer processors like Square and Stripe have gotten rid of these requirements, but presumably incur more expense and use more automation in managing the risk than conventional banks (as a result they often charge higher fees than a merchant account at a good low-cost commercial bank).
A somewhat related example was the Federal Reserve's decision several years ago to not grant a master account to a Colorado-based credit union formed specifically for the cannabis industry---if memory serves, the primary concern the FRB identified was that the low diversification of such a financial institution would make it especially fragile in response to economic or regulatory changes, creating a very high risk of the credit union going insolvent if there was some shift in the cannabis industry. I imagine an FRB would raise the same concern in relation to adult entertainment, which is also in a complex and often unclear regulatory environment due to the history of US obscenity laws, the often cash-based nature of the industry, and much of the industry being overseas.
Design the onlyfans credit card bank to be unusually secure (e.g. non-phone 2factor auth) and unusually profitable for processors (higher commissions to processors, higher value clients a la Amex).
>How are people going to find out? It could be an online only thing.
Ok, I guess you're asking about the creating a non-Visa non-Mastercard credit-card? If you're avoiding all mainstream payment networks of Visa/Mastercard/Amex then your problem really reduces to an internal OnlyFans ledger accounts. Sort of like the old days before credit-cards where each grocery store had their own "ledger accounts" for each customer.
If so, to simplify it, you really don't need the complexity of creating a "OnlyFans credit-card" as the problem reduces down to establishing direct payments to OnlyFans (e.g. bank-to-bank electronic funds transfer). This might be an option. E.g. Amazon has a way for customers to enter bank account numbers and routing info for ACH payments from a customer's checking account: https://www.amazon.com/gp/help/customer/display.html?nodeId=...
I'm guessing that OnlyFans entertained that idea for a few minutes and concluded less than 1% of customers would willingly enter direct bank account info so that OnlyFans can bypass Visa/Mastercard. Whatever the tiny percentage is, it's a drastic enough reduction in customers to make it unviable financially for both the content creators and OnlyFans.
If we're not talking about direct payments but back to the idea "credit-cards" as in an "OnlyFans credit-card"... we're strongly implying transactions on the mainstream networks Visa/Mastercard. Otherwise, there's no reason for the extra layer of complexity of "credit" and issuing a "card" to go with it that can only be used at one service.
In 2021 it’s probably much easier and cheaper to accept cryptocurrency and let the user figure out how to move the money from their bank account to their wallet(s).
Creating an entire cryptocurrency ecosystem as an alternative to taking CCBill would not go well, I agree.
They can set up their own credit card network, sure. If they want to issue their own credit card with existing network like visa or mastercard, they need permission from visa or mastercard.
These payment networks have huge network effects. I can't imagine anyone really entering that market.
No.
You have no idea whatsoever. The financial services industry might as well be a surveillance mechanism for the U.S. government at this point. Compliance/AML/KYC is huge, complex, and a giant pain in the arse.