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I'm fairly sure this is tied to anti-money laundering rules (but would be happy to be corrected). Basically, if Patreon bundled patron payments and then paid th
by huac 9y ago
I'm fairly sure this is tied to anti-money laundering rules (but would be happy to be corrected). Basically, if Patreon bundled patron payments and then paid them out to creators, it could be construed as transaction laundering.
The basic problem is that it would be cheaper for everybody involved if Patreon would charge each patron a bundled amount for all their supported campaigns, and then pay out to each creator everyone's support to them. This means that there are N + M transactions, where N is number of patrons and M is number of creators. However, due to a myriad of rules, they actually need to pay out N * M transaction fees, because each patron's contributions will be going more or less directly to each creator (minus Patreon's cut of course). The extra fees more accurately represent the cost of doing business with credit cards.
This article explains the AML rules in this area: https://www.trulioo.com/blog/transaction-laundering-a-growing-threat-to-the-payments-ecosystem/ https://www.trulioo.com/blog/transaction-laundering-a-growin...
- xchip 9y agoIf that is the concern they can go after tax havens, there is where the billions are.
- raesene9 9y agoI'm not sure that this change has anything to do with AML. Patreon already does bundle payments to creators. I get billed monthly for my various followings. That won't change at all under the new system (AFAIK). What changes is that Patreon charge me for every pledge instance that I use, which is basically crap as it doesn't cost them any more if a creator has 1, 5 or 10 pledges per month, they bundle it up and make one payment to the creator. I have no problem with the idea of Patreon charge patrons rather than creators for fees, but the "per pledge" billing is terrible.
- endgame 9y agoIf it's AML, then Patreon should come out and say it's AML, and point to the rules they have to comply with. Not write feelgood fuzzy bullshit that actually ends up with them taking a huge slice of the pie.
- rsynnott 9y ago> I'm fairly sure this is tied to anti-money laundering rules (but would be happy to be corrected). Basically, if Patreon bundled patron payments and then paid them out to creators, it could be construed as transaction laundering. I doubt this. If I buy 10 1 euro iPhone apps in a day, Apple will charge me $10, in one transaction, then eventually pay out a euro less their fees to each developer. I don't really see why this would be different.
- huac 9y agoThese are recurring payments which might be treated differently.