First, the networks have brand protection stipulations for any partner that uses the network. None of them want to be known as the porn brand.
Second, porn (and other similar categories) have a different risk profile than other charges. Specifically chargeback risk goes through the roof. None of the members of the network want to deal with sales of things that spike chargebacks.
Third, the federal government and some states have outsourced enforcement of some laws to the banks and payment networks. It’s easier to ban things than to do this enforcement at times.
None of this is a ethics issue and none of this is about money transfers. It’s about extending credit, and there is no technical solution around credit extension with electronic payments.
They could try cash-by-mail, like Mullvad.
Cash by mail would be either the merchant extending credit to the purchaser if they allowed the game download before receipt or the purchaser extending credit if not.
But in your example, you don't need to invoke a security guard stealing your apples. There is a _ton_ of credit risk already just by the invocation of the electronic payment. Your funds will not hit the account of the merchant in question for _a long time_ (usually modeled as 1-3 days for risk purposes in the US). All kinds of things can happen in that time. The merchant has extended you credit and has taken on credit risk. They've done so because of the chain of credit and agreements that the banks, processors and networks have worked out.
If Mastercard gets a bunch of its transactions reversed because a Congressional panel gets huffy about pornography, that potentially blows up transactions for apples miles away. That's why this is mostly a conversation about risk management, not morals. To the apple vendor's bank, they largely don't care if you buy porn, they just don't want their settlements caught up in the blowback.
The rules that are being invoked around porn exist to protect different parts of that chain, from each other.
The argument about Steams ability to revoke the good in question doesn't help with that. What it does is provide an alternate path if Steam wanted to extricate themselves from that chain of 7 counterparties. Steam could stop being involved with all those other players and become a payment network unto themselves. They could demand ach (or cash in the mail as the parent suggests). Give the game with the understanding they would rapidly revoke it for bad customers, and limit their exposure to the publisher by giving them very delayed payment terms. Of course, then the customer is taking on more risk and losing choice and Steam has to account for that in their sales numbers.
A puritanical activist group circumvents the law/courts and successfully pressures the handful of companies that control the vast majority of transactions to remove content they find distasteful - content that is 100% legal - but this isn’t an ethics discussion?
Mentally modeling this as “this bank doesn’t like porn” is incorrect in ways that will cause you to make incorrect downstream inferences.
There’s a reason this hasn’t been taken to the courts and regardless of what you attribute the motivation to the outcome is the same. This is top to bottom an ethics discussion, and the banks are a part of it. By capitulating they have made a choice. They decided the public debate would be bad for business.
They may be worried (slightly) but they also most likely simply don't want another headache.
A corporation is in business to make money and that means that they will do what makes the most money in the shortest amount of time as long as it's legal.
Getting entangled in a potential lawsuit that would take years to resolve and cost many millions of $ is a distraction that does not serve their interest. If you are Epic and it is in your interest to challenge Apple and if winning this lawsuit brings you potentially more revenue, then that is a different story entirely.
GP was right when he said this is a business decision. Porn has nothing to do with it. It could have been gambling and harry Potter books, the end result would have been the same.
To give you an example:
I have a small business with a very clear refund policy, yet every 6 months or so, someone will send me a message saying that they forgot that they have an active subscription and could I refund them the money or they will do a charge-back.
Please note before getting the pitchforks out, that my refund policy is very generous and that each customer gets an email before their subscription renews so there is nothing deceptive in my billing practices and also users have the ability to self refund their last payment in the app.
I am faced with the same question that Steam faced, what do I do? Do I fight the refund and eventually fight the charge-back costing me time and money when I could be doing other things or do I roll over and get it over with so that this headache goes away as soon as possible so that I can focus on my other customers?
That's how businesses see things. Opportunity cost. I understand that for some people (including you) this sort of decisions could be seen as some sort of morality judgement but IMHO it is not.
What does Steam have to gain from starting a fight with Visa or Mastercard? A better reputation with gamers? Will that help them increase their revenue in the short term or the long term? Will this make them liable for other things down the line like an angry parent suing them because their son or daughter bought a game with naked people in it and the kid was only 8 at the time?
This is the equation that I am sure many people at Steam ran and the they decided that it just wasn't adding up.
It sucks because from a personal point of view I agree with you, they should have thought harder but from a business point of view they simply followed what made most sense and decided that the risk wasn't worth the reward.
Does it mean Mastercard/Visa are right, absolutely not? This duopoly should be broken up but no politician in the west or elsewhere is going to go after them for the same reason that nobody went after the banks that brought the global economy to it's knees in 2008.
That phrasing makes it sound somehow illegal, but all the activists did was exercise their right to engage in political speech. I don't particularly agree with their cause, but there's nothing untoward about their methods.
The real problem for society isn't the fact that political groups can raise a ruckus about things we personally don't agree with, but rather the fact that payment processors are such a narrow choke point, ideal for putting up gates and thereby giving a small group of people way too much control. The solution is to address the choke point, not to play wack-a-mole trying to slap down activist groups whenever they vie for control of the choke point (which will inevitably continue to happen as long as the choke point exists.)