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Why should payment processors force them to. They will make less money

• emodendroket 5y ago
  Probably the reputational risk to them from being associated with porn is not worth whatever OnlyFans brings in.
  • pell 5y ago
    Why would OnlyFans not simply move to another payment processor then? This all seems a bit strange.
    • sascha_sl 5y ago
      It's not so easy. The obvious candidates all ban adult content, and the ones used by the porn industry are either owned by the same or take cuts that make the AppStore look reasonable.
      • pell 5y ago
        From what I understand OnlyFans has essentially no other product except for this type of content though. So I would have assumed negotiating with one of these processors for a somewhat more reasonable contract despite higher fees would still be more lucrative than giving up what seems to be their core business and revenue stream.
      • skinnymuch 5y ago
        Taking a 30% cut doesn’t seem that bad compared to the alternative. Why lose 90% of your revenue and all your profit just to not give a 30 or 40% cut to shitty middle man? Unless Onlyfans actually has some decent traction outside sexual stuff. I find that hard to believe. If photos are still allowed, that’s something. But still. Maybe I’m completely misinformed though!
      • gpvos 5y ago
        They could set up their own payment processor (unless it's really Visa or Mastercard pushing this).
    • judge2020 5y ago
      If the party pushing is Visa or Mastercard (of which 'other' processors like Paypal, Venmo, Cashapp are beholden to as well) that would only really leave cryptocurrency, which is a large barrier to taking payments and would likely mean >90% revenue loss anyways. Reminder that payment processor pressure is what has caused a lot of (legal) art to be pushed off of Patreon[0]. 0: https://www.vice.com/en/article/vbqwwj/patreon-suspension-of-adult-content-creators#:~:text=%22We%20have%20been%20ramping%20up%20the%20proactive%20review%20of%20content%20on%20Patreon%20due%20to%20requirements%20from%20our%20payment%20partners%2C%E2%80%9D https://www.vice.com/en/article/vbqwwj/patreon-suspension-of... (discussion: https://news.ycombinator.com/item?id=17432801 https://news.ycombinator.com/item?id=17432801 )
      • throwawayvisa2 5y ago
        To add: Bans some forms of anime art: https://www.dailydot.com/irl/patreon-anime-porn-ban/ https://www.dailydot.com/irl/patreon-anime-porn-ban/ Banning for activity/art outside of art hosted on Patreon: https://www.dailydot.com/irl/patreon-gay-hypnosis-artists/ https://www.dailydot.com/irl/patreon-gay-hypnosis-artists/ (articles may contain nsfw imagery)
      • arebop 5y ago
        Strike and Coinbase prohibit any use in connection with adult services in their ToS. Building/maintaining fiat onramps at scale is hard.
  • make3 5y ago
    not sure why you're getting downvoted, this is textually what is said
    • emodendroket 5y ago
      I think sometimes people downvote you for stating some fact that they think shouldn't be true. No big deal.
      • cronix 5y ago
        I just ignore all downvotes that don't give some sort of rebuttal. I just assume I pissed someone off by stating fact they didn't like otherwise. In fact, I think that would be an excellent feature - you can't downvote without an honest reply.
        • plorkyeran 5y ago
          I think that is the exact opposite of what a downvote should be for: comments which aren't even worth replying to.
          • gpvos 5y ago
            Both types exist, I'd say.
    • gpvos 5y ago
      Ignore a few downvotes in the first hour or so, they're likely to be compensated with upvotes if you're saying anything substantial.
  • elliekelly 5y ago
    Payment processors and financial institutions like to use the (IMO mostly political) cover of "AML regulations" to decline service to sex workers and sex worker-adjacent businesses. Prior to the internet and OnlyFans there was at least a tenuous connection: sex work was a cash business and all cash businesses are at "higher" risk for money laundering. Pizza shops, nail salons, car washes, etc. Of course the pizza shops and nail salons and car washes still get to open bank accounts even though they're subject to higher scrutiny behind the scenes. But that pretext for excluding sex workers from banking and payment processing really falls apart with OnlyFans. These are small, repeated, digital payments that are highly traceable because they're coming from and going to known people. And the existence of the underlying work product is easily verifiable: are the accounts actively posting content or not?
    • brador 5y ago
      The issue is sex trafficking not money laundering here.
      • elliekelly 5y ago
        It's six in one and a half dozen in the other. Banks only care about sex trafficking because sex trafficking is a crime and processing money from criminal activity is... money laundering. But regardless, what's the risk of sex trafficking here? Again, these payments are coming from and going to known parties. In fact, this should be a KYC dream come true. Because of the adult content OnlyFans collects (and in the case of payment recipients, confirms) the name, DOB, and address of everyone buying and selling on the platform. If human trafficking were the actual risk banks were trying to mitigate here then it would be difficult for any business sector that relies on migrant workers to obtain banking services but I've never heard of an almond grower having trouble opening a bank account.
    • rapind 5y ago
      You had (still have?) the same issue with marijuana businesses. Not easy to open a bank account for a marijuana business.
  • cronix 5y ago
    I don't think I've ever been on onlyfans, but anytime I've heard the name in a news context it is associated with pay-for-porn. I don't think I've ever heard of a non-porn thing on there, whether its in the news or people advertising their fan site. Do they actually have some sort of non-porn reputation that exceeds the porn reputation that I've never heard mentioned before? From what I gather, their reputation is about the same as pornhub, when it comes to "porn." I don't see how they fix that, and stay in business. This is just an opinion of a passer-by who casually hears the name. I don't think I'm much different than most people who have never been on there, which I'm assuming is most people in general.
    • kyleee 5y ago
      I suspect they have a lot of models that toe the line of sexual explicitness; but I certainly have the same perception of the site
  • JohnBooty 5y ago
    Not a reputation thing, unless that's changed lately. You can use credit cards for all kinds of porn and various shady things, they don't care. For decades, the specific issue was with the huge chargeback/fraud rates associated with online porn. - People paying for porn with stolen cards - Or, more frequently, people disputing the charges when their wives see the credit card statements and get mad, so they claim the card was stolen etc.
• gumby 5y ago
  I had a friend who ran a “sexually explicit” site you’ve heard of. He was paying north of 25% to payment processors (compare to less than .2% restaurants pay…though his margins were much bigger). The payment processors take this attitude because that way they can tell congress they are “doing something about vice”, and in exchange not be subject to undesired regulations. I suspect this kind of soft pressure is being applied to Apple in the background. Everyone remembers what happened to Joe Nacchio, and resisting such pressure is harder now than it was over the last four years.
  • admn2 5y ago
    Seems like a business opportunity for someone to build a Stripe for vice businesses. Question I know nothing about is besides being stigmatized, do these industries have higher fraud rates? Pretty sure credit card companies won't let you "chargeback" stripe clubs as fraud even if it wasn't you.
    • mind-blight 5y ago
      My roommate is one of the risk analysts on the fraud team for a large subprime credit card company. About 45% of credit card transactions from OnlyFans are CC fraud. Edit: update numbers to be correct
      • stevenicr 5y ago
        would you please clarify the type of fraud. for example, I think a lot of people hear this and assume the fraud is like, caused by an OF model - not delivering what was promised for example.. However seeing your statement, I am thinking it's that much fraud because criminals are getting stolen card / Id details from the darker webs and they are using other people's cards for fun things - and OF is a popular place to blow other people's money. Maybe it's a mix of both - but I would think it's more the other way. I remember when there were big numbers of fraud pointed at adult sites back in the day - but the core reason was so many offered $1 trials, and it was a popular way to test if a card number you got was valid / not reported stolen yet - use a cheap porn site. I saw a (possibly npr?) story a while back saying that many criminals are now using dominoe's pizza to test if (stolen ) cards are good, because it's cheap and they get a bonus free pizza for a friend. So it's not the pizza place or the porn site that is really encouraging the fraud or creating it.. unless you get into the weeds of they accepted a card without the exact right address and so they are a target for card testers.. that's a different discussion and such.
• yibg 5y ago
  Adult content usually has a high charge back rate. “What? How did this get here? My card must’ve been stolen” when the spouse sees the statement.
  • nix23 5y ago
    IDEA: Master/Slave-Card, available in Black or Brown just chargeable with crypto or cash max amount 300$ no address needed, if lost, your problem.
    • vxNsr 5y ago
      visa/mc giftcards are a thing.
      • nix23 5y ago
        Really? Never heard of that...maybe a US thing then?
        • dogma1138 5y ago
          Prepaid cards including virtual cards are available in Europe..
          • nix23 5y ago
            Cant pay with them on OnlyFans, let alone buying used bath water.
            • dogma1138 5y ago
              I wouldn’t know, I’m just saying the exist too in Europe. Also many of the multi-chain gift cards are also prepaid payment cards they go through the same payment system it’s much easier to leverage it than to build another one.
        • da_big_ghey 5y ago
• _rpd 5y ago
  If you think about what payment processors actually do, dealing with fraud is one of the main costs. There's a lot of fraud associated with porn related transactions, so it can make financial sense to just drop the entire transaction category.
• jlengrand 5y ago
  Because it is a high risk area, just like gambling
• dhosek 5y ago
  Some years ago I interviewed with a company that served as a payment risk processor for high-risk businesses (in short, porn). The chargeback rate on online porn is huge. As a result, where a traditional payment processor may be 1.3–3.5% depending on the business and the assessed risk, for a high-risk business, the rate can be much much higher. While Onlyfans keeps 20%, I'm guessing that they'd be badly hurt if they had to give half that to their payment processor. I'm sure they've looked at their numbers and they find the non-porn providers are more profitable to them, especially if it means they can lower their processing fees. Booting the porn providers will likely also make it easier to recruit more non-porn providers.
  • grishka 5y ago
    Another thing that feels uniquely-US to me is chargebacks. I don't even know what's the process for initiating one in Russia. I once wanted to do that (forgot to disable auto-payment for internet in the apartment I rented and since moved from), called my bank, they told me that there's nothing they could do and I have to talk to the merchant to get a refund. But many comments here imply that chargeback is almost as easy as clicking a button or asking nicely. How's that?
    • ceejayoz 5y ago
      The US has specific legal rights to a chargeback. https://en.wikipedia.org/wiki/Truth_in_Lending_Act https://en.wikipedia.org/wiki/Truth_in_Lending_Act "I forgot to disable automatic billing" probably wouldn't be a valid chargeback, though.
    • _rpd 5y ago
      It makes it easy to comply with the Fair Credit Billing Act: https://en.wikipedia.org/wiki/Fair_Credit_Billing_Act https://en.wikipedia.org/wiki/Fair_Credit_Billing_Act
    • klodolph 5y ago
      In the US, you can't click a button to make a chargeback happen. People are eliding some of the steps or being a bit sloppy with the terminology. A chargeback is something that the bank (or rather, the credit card issuer) does to merchants. You can log in to your credit card account, click on a transaction, and open a dispute. You have to choose a reason for the dispute. The reason has to be something like, "I was charged for a product, but never received the product." This just starts the process. The end result may be a chargeback to the merchant.