Why payment processors do it? Why people in America do not want to earn more money from commissions? Strong church lobby? Legal risks? I think its mostly religious groups who who are against adult content and sex, or there are other groups?
Also this is why we should work to increase circulation of cryptocurrency. No stupid religious restrictions and stupid political sanctions.
Also why PornHub and OnlyFans are immune to religious lobby?
The payment processors say the reason is high fraud and charge-back rates in those industries that make it unprofitable to service. I don't know if this is true or an excuse. Either way, its an excellent reason why this critical infrastructure shouldn't be under corporate control.
Stripe (their payment process) will handle adult content payments. It puts the account into the high risk category due to the high rate of fraud in those categories.
There's no actual evidence in the article that payment processors made them do it. They actually banned pornography long before this. They just updated the terms to clarify what counted as pornography.
Kickstarter already banned pornographic content before this. They expanded the rules to include more specifics. That's it. That's the story. Everything else is speculation and anger-mongering.
> While the previous version of the page simply prohibited “Pornographic content,” it now contains some oddly specific restrictions, including, but not limited to, “implied sex acts,” “MILF/DILF” content, “implied nudity,” and anything featuring “female nipples/areolas, genitalia,” and “anuses.” Good heavens, they’ve even banned “buttocks.”
The article quotes some speculation from some other blog that is trying to link this to Elon Musk and Peter Thiel for maximum anger points:
> Why? According to a report by The Daily Cartoonist, Kickstarter may be under pressure from its payment processor, Stripe, which Palantir Chairman Peter Thiel and X proprietor Elon Musk partially own. Kickstarter and Stripe did not immediately respond to a request for comment.
However Stripe actually does service adult content sites. It just falls into a category of high-risk merchants that also includes travel sites, cryptocurrency, gambling, tobacco, and other categories where the chargeback rates are statistically much higher. They will service those sites, but you might have higher fees to compensate for the higher chargeback rates that come with those categories
> But he was friendly with Mastercard’s then-CEO Ajay Banga, whom he had met through a mutual friend. Ackman texted Banga, providing a link to Kristof’s story with his tweet: “Amex, VISA and MasterCard should immediately withhold payments or withdraw until this is fixed. PayPal has already done so.” (Ackman was unaware that American Express already did not allow its card to be used on adult sites.)
> Banga quickly wrote back: “We’re on it.”
> Then things began to move. Within days, Mastercard announced it had “instructed the financial institutions that connect the site to our network to terminate acceptance” of [PH] charges, saying it had found evidence of illegal activity and was continuing to investigate.
So, the problem is that he feels strongly about not incentivizing what he considers sexual exploitation. If he had the reverse position, then suddenly you would feel more positively about his identity group?
Stripe (their payment process) will service adult content sites. It's not actually banned, but if your business is involved in categories with high chargeback rates (travel, gambling, cryptocurrency, vaping, adult content) you have to pay higher fees to account for the higher fraud rate in those categories
> I’ve heard this is apparently less about morality and more about payments getting contested by men getting caught by their spouses
This is a common myth. The concerted effort that we've seen over the last 5-10 years in particular is the direct consequence of intense lobbying from a handful of groups that are openly backed by or aligned with right-wing religious groups, especially (but not exclusively) evangelicals.
In case you have any doubts about whether "morality" is their motivation, one of the groups was literally called "Morality in Media", before renaming to the more official-sounding National Center on Sexual Exploitation. Despite the new name, they actually don't care very much about "sexual exploitation" as most reasonable people would define the term (such as child abuse) but instead consider all sex work to be "exploitation" and aim to ban legal sex work.
Banks frequently refuse to do business with, or heavily restrict, businesses that they deem risky from a financial perspective. Adult content, pharmaceuticals and travel are all industries that experience significantly higher occurrence of fraud and chargebacks than others. For example, your spouse sees a weird item on your credit card for a porn site. "Wasn't me! Must be stolen I'll report it." Sometimes it's the other direction. Travel businesses often get by on very thin margins with any significant balances due to deposits. If something happens, customers might get deposits back, or they might get chargebacks, and the business can rapidly end up deep in the red.
Often times to bank successfully you need large stagnant balances that are semi-frozen, or meaningful collateral.
This becomes problematic through payment provider platforms which other platforms build upon: it's not straightforward to manage these relationships through so many layers of abstractions. It's easier just to ban the industry.
I don't know the specifics of Kickstarter, but I've seen this happen countless times, so it's not difficult to connect the dots.
Right-wing, openly evangelical groups like Exodus Cry and Morality in Media, who have an explicit agenda to ban pornography and see this as an easy "next step" towards that end goal.
They are also the groups behind the closure of big porn sites like XTube, the short-lived purge of adult content on OnlyFans (one of the few battles they lost), and the scourge of age verification bills that are sweeping the US, UK, and Europe.
The goal with age verification laws is not to protect minors or fight CSAM (as much as they pretend it is) - it's to make it expensive and difficult to legally serve content that they disapprove of, producing a chilling effect. Note that the content they disapprove of is not limited to pornography, which is why many of these bills have such vague language that can apply to other things like information on abortion, or LGBTQ+ themed material. This is not an accident; the supporters of these policies are quite open about their intention.
If you dig, this issue has been brewing for quite some time. Long story short, its the hard-right conservatives and/or Christians who demand everybody *else* follow their recidivist ethics.
Morality in Media (renamed to "National Center on Sexual Exploitation" to deceive as federal org) - Intersection of Conservatives and Christians, wanting to ban anything their bronze age beliefs indicate are bad.
Even despite the one case we have of an organization claiming credit for pressuring the credit card companies, I'm not convinced this is a case of anyone externally pressuring them. Adult content is well-known for having high rates of chargebacks and fraud, which you can find all over the place but here's a link: https://payatlas.com/industry/adult-content-4856#risk-profil... (see Risk Profile section, which this has a link to but seems to jump to a bit above it)
If you run the math, chargebacks and fraud are murder on the credit card company business model. I think this alone is sufficient to make the credit card companies do what they are doing.
Especially because I just don't see much evidence there's anything else driving this. There's no moral panic being run in the media. There isn't a clear political impetus that I can see across the entire timeline that this has been occurring (e.g., this isn't just a Trump presidency thing). I think it makes plenty of sense that this is just about the money and nothing else. It's a lot of money to the credit card processors.
I think the pressure is just coming from behind the scenes.
The religious right knows many of their views are unpopular so they don't act in the open. They find underhanded ways to force their views onto us. Abortion bans wouldn't survive a simple up and down vote in almost any state, yet abortion bans are happening across the country.
The religious right really has their claws into this administration, and the far right has a much larger say in things than it seems like they would based on their proportional representation in the population. Things like gerrymandering and closed primaries don't help.
> It's not a sudden new thing. The financial theory seems to explain all the facts.
Literally all three of the examples you list were the direct result of lobbying from groups like Exodus Cry and Morality in Media. These campaigns had been in the works for years, and were well-known to people in the industry, who had been sounding the alarm for years.
It's maddening that people not only refuse to listen before the actions come down, but also still refuse to connect the dots even after they happen.
> The religious right knows many of their views are unpopular so they don't act in the open. They find underhanded ways to force their views onto us. Abortion bans wouldn't survive a simple up and down vote in almost any state, yet abortion bans are happening across the country.
They do act out in the open! That's why it's so maddening to see how pervasive the belief that this isn't a push from right-wing groups is. They are extremely open about their goals and about their ideological alignment, and they have been at literally every step in the process.
They're telegraphing every single move in real-time. But for some reason, people just don't really want to believe it.
It turns out, the best way to get away with a heinous agenda is not to hide it, but to be completely open and direct about it. If you tell people exactly what they want and it's horrific enough, they will refuse to believe it's true, because nobody would be that cartoonishly villainous, right?
The sex industry isn't the only area where that principle works, although (like with many "technologies") it was one of the first where it was successfully applied.
We have one in Russia, called Mir (world/peace, somewhat ironically). While, yes, there was literally zero downtime on card payments when Visa and MC left the country, they are still irreplaceable for international payments. As a result, everyone who needs to make them or travels a lot has a foreign bank account now, with, you guessed it, a Visa or MC card.
Then government leaders would be less able to circumvent civil rights and transparency measures (where those exist). That is why the government farms out infrastructure to non government entities.
This way, there is always a threat of businesses deciding not to do business with you by unaccountable forces.
I worked for a payment processor in Europe, we provided SEPA and some other payments, but not card payments (so there could be some difference).
Difference is in fees and licenses. Payment processors that process high risk payments (adult industry, gambling, etc...) have higher fees and need license from governing body (usually a national bank in country where the payment processor is registered). So if you process high risk payments as low risk you will get a fine from governing body and you risk to lose your license. And if you don't have a license for high risk payments you cannot process them.
I don't work there anymore, but I heard they lost SEPA license a couple of years ago because of risky transactions.
Now I am not sure if Visa and Master are forcing payment providers to give up high risk transactions or if they are forcing them to classify all transactions as low/high risk.
> Question: what prevents an organisation like Kickstarter from using more than one payment processor, including the ones used by actual porn companies?
The way the policies work, they would either have to use the latter processor for all transactions (which would be prohibitively expensive) or relegate all "adult" content to a completely separate company and domain, which would be a huge pain and expense to operate for something that constitutes a relatively small fraction of their business.
Nothing prevents them, and some companies that want to support both adult and non-adult content do. But it's also reasonable for Kickstarter to decide that adult content is not so important to them that they want to jump through hoops to dodge Stripe's rules.
The way governments these days use corporations and NGOs to work around constitutional restrictions, I'm sure they're pretty happy leaving the payment processors as-is.
I feel like if you’re going to write an article like this, you should at least engage with why it’s happening. Maybe deep down for some of the participants it’s a kind of moral thing, but mostly this is because payments for NSFW/porn stuff are dramatically more expensive. All of the “stuff” payment processors are doing is harder for NSFW/porn content, so that’s the main reason the processors want these companies to separate/cutoff that type of content.
Why payment processors do it? Why people in America do not want to earn more money from commissions? Strong church lobby? Legal risks? I think its mostly religious groups who who are against adult content and sex, or there are other groups?
Also this is why we should work to increase circulation of cryptocurrency. No stupid religious restrictions and stupid political sanctions.
Also why PornHub and OnlyFans are immune to religious lobby?
The payment processors say the reason is high fraud and charge-back rates in those industries that make it unprofitable to service. I don't know if this is true or an excuse. Either way, its an excellent reason why this critical infrastructure shouldn't be under corporate control.
Stripe (their payment process) will handle adult content payments. It puts the account into the high risk category due to the high rate of fraud in those categories.
There's no actual evidence in the article that payment processors made them do it. They actually banned pornography long before this. They just updated the terms to clarify what counted as pornography.
Headline is misleading on multiple levels.
Kickstarter already banned pornographic content before this. They expanded the rules to include more specifics. That's it. That's the story. Everything else is speculation and anger-mongering.
> While the previous version of the page simply prohibited “Pornographic content,” it now contains some oddly specific restrictions, including, but not limited to, “implied sex acts,” “MILF/DILF” content, “implied nudity,” and anything featuring “female nipples/areolas, genitalia,” and “anuses.” Good heavens, they’ve even banned “buttocks.”
The article quotes some speculation from some other blog that is trying to link this to Elon Musk and Peter Thiel for maximum anger points:
> Why? According to a report by The Daily Cartoonist, Kickstarter may be under pressure from its payment processor, Stripe, which Palantir Chairman Peter Thiel and X proprietor Elon Musk partially own. Kickstarter and Stripe did not immediately respond to a request for comment.
However Stripe actually does service adult content sites. It just falls into a category of high-risk merchants that also includes travel sites, cryptocurrency, gambling, tobacco, and other categories where the chargeback rates are statistically much higher. They will service those sites, but you might have higher fees to compensate for the higher chargeback rates that come with those categories
Source https://stripe.com/ie/resources/more/high-risk-merchant-acco...
So who is pressuring the processors?
The actual answer: hedge fund manager Bill Ackman. https://www.institutionalinvestor.com/article/2bswuu1nfc040h...
> But he was friendly with Mastercard’s then-CEO Ajay Banga, whom he had met through a mutual friend. Ackman texted Banga, providing a link to Kristof’s story with his tweet: “Amex, VISA and MasterCard should immediately withhold payments or withdraw until this is fixed. PayPal has already done so.” (Ackman was unaware that American Express already did not allow its card to be used on adult sites.)
> Banga quickly wrote back: “We’re on it.”
> Then things began to move. Within days, Mastercard announced it had “instructed the financial institutions that connect the site to our network to terminate acceptance” of [PH] charges, saying it had found evidence of illegal activity and was continuing to investigate.
early life... yep
So, the problem is that he feels strongly about not incentivizing what he considers sexual exploitation. If he had the reverse position, then suddenly you would feel more positively about his identity group?
What’s the implication here? Jews are forcing payment processors to ban adult content?
Stripe (their payment process) will service adult content sites. It's not actually banned, but if your business is involved in categories with high chargeback rates (travel, gambling, cryptocurrency, vaping, adult content) you have to pay higher fees to account for the higher fraud rate in those categories
https://stripe.com/ie/resources/more/high-risk-merchant-acco...
Lots of anti porn groups out there that complain to them.
It could be any link in the chain. They will never tell you though. It's the perfect unaccountability machine.
I’ve heard this is apparently less about morality and more about payments getting contested by men getting caught by their spouses
[delayed]
I don't have any data on this, so don't quote me on it at all, but this feels more like an excuse made up by paypros than an actual good explanation.
That's not the reason. Cost of chargebacks falls entirely on the merchant. Visa/MC have no reason to care.
Those people should have used cryptocurrencies.
You mean using currencies where all the transactions are public?
> I’ve heard this is apparently less about morality and more about payments getting contested by men getting caught by their spouses
This is a common myth. The concerted effort that we've seen over the last 5-10 years in particular is the direct consequence of intense lobbying from a handful of groups that are openly backed by or aligned with right-wing religious groups, especially (but not exclusively) evangelicals.
In case you have any doubts about whether "morality" is their motivation, one of the groups was literally called "Morality in Media", before renaming to the more official-sounding National Center on Sexual Exploitation. Despite the new name, they actually don't care very much about "sexual exploitation" as most reasonable people would define the term (such as child abuse) but instead consider all sex work to be "exploitation" and aim to ban legal sex work.
It’s not even that complex.
The chargeback rates might just be higher than the payment processors feel like dealing with.
I’m more than fine with more transactions leaving the traditional credit card system.
Giving Visa a 3% surcharge on the entire economy never felt right
Visa and Mastercard operate electronic payment networks for debit transactions, which are almost free, and would also be banned by this.
Leaving the only other electronic payment methods as ACH (which is not ideal for most businesses), Paypal, and I don’t know what else.
The idea is that chargeback rates are that high because of people getting caught by their spouses.
Conservative religious groups
Banks
But who is pressuring the banks? https://en.wikipedia.org/wiki/Operation_Choke_Point
Banks frequently refuse to do business with, or heavily restrict, businesses that they deem risky from a financial perspective. Adult content, pharmaceuticals and travel are all industries that experience significantly higher occurrence of fraud and chargebacks than others. For example, your spouse sees a weird item on your credit card for a porn site. "Wasn't me! Must be stolen I'll report it." Sometimes it's the other direction. Travel businesses often get by on very thin margins with any significant balances due to deposits. If something happens, customers might get deposits back, or they might get chargebacks, and the business can rapidly end up deep in the red.
Often times to bank successfully you need large stagnant balances that are semi-frozen, or meaningful collateral.
This becomes problematic through payment provider platforms which other platforms build upon: it's not straightforward to manage these relationships through so many layers of abstractions. It's easier just to ban the industry.
I don't know the specifics of Kickstarter, but I've seen this happen countless times, so it's not difficult to connect the dots.
Right-wing, openly evangelical groups like Exodus Cry and Morality in Media, who have an explicit agenda to ban pornography and see this as an easy "next step" towards that end goal.
They are also the groups behind the closure of big porn sites like XTube, the short-lived purge of adult content on OnlyFans (one of the few battles they lost), and the scourge of age verification bills that are sweeping the US, UK, and Europe.
The goal with age verification laws is not to protect minors or fight CSAM (as much as they pretend it is) - it's to make it expensive and difficult to legally serve content that they disapprove of, producing a chilling effect. Note that the content they disapprove of is not limited to pornography, which is why many of these bills have such vague language that can apply to other things like information on abortion, or LGBTQ+ themed material. This is not an accident; the supporters of these policies are quite open about their intention.
If you dig, this issue has been brewing for quite some time. Long story short, its the hard-right conservatives and/or Christians who demand everybody *else* follow their recidivist ethics.
Exodus Cry - https://en.wikipedia.org/wiki/Exodus_Cry explicit christian thinktank
Collective Shout - https://en.wikipedia.org/wiki/Collective_Shout not explicitly christian, but mirrors Exodus Cry almost verbatim
Going down the rabbit hole of Financial Censorship also shows a few other bad actor sin this space. https://en.wikipedia.org/wiki/Financial_censorship
FiLiA - https://en.wikipedia.org/wiki/FiLiA hard conservative feminist group, hates transgender
Morality in Media (renamed to "National Center on Sexual Exploitation" to deceive as federal org) - Intersection of Conservatives and Christians, wanting to ban anything their bronze age beliefs indicate are bad.
CATiW - https://en.wikipedia.org/wiki/Coalition_Against_Trafficking_... , another far-conservative anti-trans hate group.
Even despite the one case we have of an organization claiming credit for pressuring the credit card companies, I'm not convinced this is a case of anyone externally pressuring them. Adult content is well-known for having high rates of chargebacks and fraud, which you can find all over the place but here's a link: https://payatlas.com/industry/adult-content-4856#risk-profil... (see Risk Profile section, which this has a link to but seems to jump to a bit above it)
If you run the math, chargebacks and fraud are murder on the credit card company business model. I think this alone is sufficient to make the credit card companies do what they are doing.
Especially because I just don't see much evidence there's anything else driving this. There's no moral panic being run in the media. There isn't a clear political impetus that I can see across the entire timeline that this has been occurring (e.g., this isn't just a Trump presidency thing). I think it makes plenty of sense that this is just about the money and nothing else. It's a lot of money to the credit card processors.
I think the pressure is just coming from behind the scenes.
The religious right knows many of their views are unpopular so they don't act in the open. They find underhanded ways to force their views onto us. Abortion bans wouldn't survive a simple up and down vote in almost any state, yet abortion bans are happening across the country.
The religious right really has their claws into this administration, and the far right has a much larger say in things than it seems like they would based on their proportional representation in the population. Things like gerrymandering and closed primaries don't help.
October 2021, Mastercard unilaterally imposes additional constraints on adult sites: https://www.commercegate.com/mastercard-issued-an-updated-se...
August 2021: OnlyFans CEO Blames Porn Ban on 'Unfair Actions' of Banks, Media: https://www.pcmag.com/news/onlyfans-ceo-blames-porn-ban-on-u...
April 2024: Japanese Adult content platform DLsite disables Visa/Mastercard payment after attempt to outsmart credit card companies: https://automaton-media.com/en/news/dlsite-disables-visa-mas...
It's not a sudden new thing. The financial theory seems to explain all the facts.
> It's not a sudden new thing. The financial theory seems to explain all the facts.
Literally all three of the examples you list were the direct result of lobbying from groups like Exodus Cry and Morality in Media. These campaigns had been in the works for years, and were well-known to people in the industry, who had been sounding the alarm for years.
It's maddening that people not only refuse to listen before the actions come down, but also still refuse to connect the dots even after they happen.
> The religious right knows many of their views are unpopular so they don't act in the open. They find underhanded ways to force their views onto us. Abortion bans wouldn't survive a simple up and down vote in almost any state, yet abortion bans are happening across the country.
They do act out in the open! That's why it's so maddening to see how pervasive the belief that this isn't a push from right-wing groups is. They are extremely open about their goals and about their ideological alignment, and they have been at literally every step in the process.
They're telegraphing every single move in real-time. But for some reason, people just don't really want to believe it.
It turns out, the best way to get away with a heinous agenda is not to hide it, but to be completely open and direct about it. If you tell people exactly what they want and it's horrific enough, they will refuse to believe it's true, because nobody would be that cartoonishly villainous, right?
The sex industry isn't the only area where that principle works, although (like with many "technologies") it was one of the first where it was successfully applied.
There should be a national payment processing operator as an alternative to VISA/MC. Just like they do it in many other countries.
We have one in Russia, called Mir (world/peace, somewhat ironically). While, yes, there was literally zero downtime on card payments when Visa and MC left the country, they are still irreplaceable for international payments. As a result, everyone who needs to make them or travels a lot has a foreign bank account now, with, you guessed it, a Visa or MC card.
Has Mir in the past ever implemented any kind of bans or restrictions for specific vendors or use cases?
Then government leaders would be less able to circumvent civil rights and transparency measures (where those exist). That is why the government farms out infrastructure to non government entities.
This way, there is always a threat of businesses deciding not to do business with you by unaccountable forces.
>This way, there is always a threat of businesses deciding not to do business with you by unaccountable forces.
Visa/Mastercard vs the government itself is bordering on a distinction without a difference.
From the perspective of the average business or person they're both wholly unaccountable.
If you're Kickstarter or some Megacorp, well then it probably just depends which you have more friends in high places.
Question: what prevents an organisation like Kickstarter from using more than one payment processor, including the ones used by actual porn companies?
I worked for a payment processor in Europe, we provided SEPA and some other payments, but not card payments (so there could be some difference).
Difference is in fees and licenses. Payment processors that process high risk payments (adult industry, gambling, etc...) have higher fees and need license from governing body (usually a national bank in country where the payment processor is registered). So if you process high risk payments as low risk you will get a fine from governing body and you risk to lose your license. And if you don't have a license for high risk payments you cannot process them.
I don't work there anymore, but I heard they lost SEPA license a couple of years ago because of risky transactions.
Now I am not sure if Visa and Master are forcing payment providers to give up high risk transactions or if they are forcing them to classify all transactions as low/high risk.
The fact that if they don't ban it, Visa and Mastercard will blacklist them and they have 99% of the market share.
> Question: what prevents an organisation like Kickstarter from using more than one payment processor, including the ones used by actual porn companies?
The way the policies work, they would either have to use the latter processor for all transactions (which would be prohibitively expensive) or relegate all "adult" content to a completely separate company and domain, which would be a huge pain and expense to operate for something that constitutes a relatively small fraction of their business.
Nothing prevents them, and some companies that want to support both adult and non-adult content do. But it's also reasonable for Kickstarter to decide that adult content is not so important to them that they want to jump through hoops to dodge Stripe's rules.
That's what I want to know.
VISA is the government
When inequality is high capital is the government.
actually if they were it would be easier to argue it's a violation of free speech, but since they're not they can censor with much less restriction
tbh there's a case to be made that the government should run a payment processor as critical infrastructure
The way governments these days use corporations and NGOs to work around constitutional restrictions, I'm sure they're pretty happy leaving the payment processors as-is.
Kickstarter should allow ACH transfer and checks for such projects. @#$% the man.
You shall not receive money in "easy" ways.
"Let me issue and control a nation's money and I care not who writes the laws."
I feel like if you’re going to write an article like this, you should at least engage with why it’s happening. Maybe deep down for some of the participants it’s a kind of moral thing, but mostly this is because payments for NSFW/porn stuff are dramatically more expensive. All of the “stuff” payment processors are doing is harder for NSFW/porn content, so that’s the main reason the processors want these companies to separate/cutoff that type of content.
How is it more expensive?
Because it cost more to check that my CC wasn't stolen when I buy NSFW?
Or because there are more chargeback?
If it was more expensive to process, why wouldn't they pass those costs on?
The increased costs are from the increased rate of chargebacks.