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I would also like to know on whether it's possible for someone to start their own payment processors? There are tutorials on how to start an ISP, so should be

I would also like to know on whether it's possible for someone to start their own payment processors? There are tutorials on how to start an ISP, so should be possible for payment processors too no?

Daedren 5y ago
No because the banks from which the payments come from must support said processors. Many countries have their own local payment processors, but it's still only a country-wide thing.
- busymom0 5y ago
  So I guess starting a bank is the next step?
  - elliekelly 5y ago
    Payment processing isn’t something a bank gets to decide on their own either. It’s decided by a group. In the US it’s NACHA:https://en.m.wikipedia.org/wiki/NACHA https://en.m.wikipedia.org/wiki/NACHA
    - jtbayly 5y ago
      I don’t see any mention of payment processing in there. Have another link?
- LegitShady 5y ago
  Sounds like a cartel gatekeeping the role of processor, and then the processors can put pressure on any business to do what they want or face “the consequences” which means no income (aside from crypto which most people don’t know how to use).
staticassertion 5y ago
The bar is probably much higher. Among other things you're going to have a ton of regulatory controls to deal with.
knicholes 5y ago
Why not use crypto? Porncoin2.
- duxup 5y ago
  Is there a way to do that where customers / content creators don't eventually hit traditional payment processor / bank?
  - dylan604 5y ago
    not until you can reliably buy groceries, pay rent, pay utilities, etc with that crypto, it has to get exchanged for local currency somehow.
- Saris 5y ago
  You still need to pass through a bank to convert it to anything usable.
  - knicholes 5y ago
    How will the banks know the crypto came from porn, though? Receive payments either to your own wallet or straight to Coinbase, convert to USD, transfer to your bank, and we're done, right? What am I missing?
    - deleted 5y ago
      [deleted]
    - NateEag 5y ago
      Maybe that to accept payments the porn company has to publish wallet IDs, so payments can in fact be traced back to them?
  - vageli 5y ago
    That doesn't seem like it would be a problem for individual creators though, unless all exchanges coordinate to ban sex workers or something (not to mention decentralized exchanges like bisq, or in-person exchanges like localbitcoins).
after_care 5y ago
I think the traditional Visa/MasterCard/American Express/Discover payment processor has established a significant enough moat to make joining them unattractive. There are several challengers like Paypal, Venmo, Zelle, Coinbase, etc that attack from a slightly different angle. I think the thing that is most common is that have super low cost bank transfer options, and they encourage users to maintain a balance. Processing payments locally is 100x-1000x preferable then processing payments externally for these players.
- mschuster91 5y ago
  PayPal is even worse for sex workers, they're banning people left and right if they even suspect you might be involved into anything relating to it. Their official stance always has been that this is due to the credit card companies, the reality rather is that Paypal doesn't want to deal with the rampant fraud (aka post-nut clarity) in porn.
PeterisP 5y ago
Starting your own payment processor is done reasonably frequently, it has a certain barrier of entry (a few million and a year or two for all the approvals, so feasible with investor backing if you have a valid business reason to make a payment processor) but it's being done regularly and also you can buy and rebrand an existing one, which is a common way to get a quicker market entry at the cost of a bit more money. However, that new processor will be a member of some existing payment systems e.g. Visa network and bound by all the same constraints as the other processors there. Creating your own alternative to a payment system (e.g. a major, widely and internationally supported card network like Visa or MC) is not really plausible. Perhaps you can look at the whole setup of cryptocurrencies+all the crypto exchange companies as something like such an alternative system, so there's one alternative made in this millenium.
Mvandenbergh 5y ago
It is. The problem is connecting to the rest of the financial system. Imagine starting an "ISP" that had not upstream connectivity. It wouldn't be an ISP then. Same problem here. There's a few players here: payment gateways, this is a service that provides the checkout service on a website and handles protected credit card information. Payment gateways also provide anti-fraud services. payment processors, these execute the actual transaction. They are members of card associations like Visa and connect the card issuing bank and the merchant bank of the payee. merchant banks, these are the banks that hold the company's bank account that the funds from the payment processor come into. card associations, Visa/Mastercard these provide the connectivity and set the high level rules. card issuers, these entities extend credit and may be retail banks or other parties. there is a difference between Amex/Discover and Visa/Mastercard in that the former are also the issuer. That's why you also see Visa debit cards in Europe, they're using the payment processing network but not extending credit. It should be clear that starting a new payment gateway is trivial. It takes money to properly comply but ultimately this is a software business. Starting a new payment processor is much harder but it doesn't matter because all payment processors must comply with the card association rules to get access to that network. Starting your own card network would require attracting issuers who would then issue cards that people could use to pay for OnlyFans... probably not realistic! It was the threat by Visa and MC to cut them off that was the killer here, plenty of payment processors would be happy to take their money but not if the card networks ban the company.

I would also like to know on whether it's possible for someone to start their own payment processors? There are tutorials on how to start an ISP, so should be possible for payment processors too no?

Daedren 5y ago

No because the banks from which the payments come from must support said processors. Many countries have their own local payment processors, but it's still only a country-wide thing.

busymom0 5y ago
So I guess starting a bank is the next step?
- elliekelly 5y ago
  Payment processing isn’t something a bank gets to decide on their own either. It’s decided by a group. In the US it’s NACHA:https://en.m.wikipedia.org/wiki/NACHA https://en.m.wikipedia.org/wiki/NACHA
  - jtbayly 5y ago
    I don’t see any mention of payment processing in there. Have another link?
LegitShady 5y ago
Sounds like a cartel gatekeeping the role of processor, and then the processors can put pressure on any business to do what they want or face “the consequences” which means no income (aside from crypto which most people don’t know how to use).

staticassertion 5y ago

The bar is probably much higher. Among other things you're going to have a ton of regulatory controls to deal with.

knicholes 5y ago

Why not use crypto? Porncoin2.

duxup 5y ago
Is there a way to do that where customers / content creators don't eventually hit traditional payment processor / bank?
- dylan604 5y ago
  not until you can reliably buy groceries, pay rent, pay utilities, etc with that crypto, it has to get exchanged for local currency somehow.
Saris 5y ago
You still need to pass through a bank to convert it to anything usable.
- knicholes 5y ago
  How will the banks know the crypto came from porn, though? Receive payments either to your own wallet or straight to Coinbase, convert to USD, transfer to your bank, and we're done, right? What am I missing?
  - deleted 5y ago
    [deleted]
  - NateEag 5y ago
    Maybe that to accept payments the porn company has to publish wallet IDs, so payments can in fact be traced back to them?
- vageli 5y ago
  That doesn't seem like it would be a problem for individual creators though, unless all exchanges coordinate to ban sex workers or something (not to mention decentralized exchanges like bisq, or in-person exchanges like localbitcoins).

after_care 5y ago

I think the traditional Visa/MasterCard/American Express/Discover payment processor has established a significant enough moat to make joining them unattractive. There are several challengers like Paypal, Venmo, Zelle, Coinbase, etc that attack from a slightly different angle. I think the thing that is most common is that have super low cost bank transfer options, and they encourage users to maintain a balance. Processing payments locally is 100x-1000x preferable then processing payments externally for these players.

mschuster91 5y ago
PayPal is even worse for sex workers, they're banning people left and right if they even suspect you might be involved into anything relating to it. Their official stance always has been that this is due to the credit card companies, the reality rather is that Paypal doesn't want to deal with the rampant fraud (aka post-nut clarity) in porn.

PeterisP 5y ago

Starting your own payment processor is done reasonably frequently, it has a certain barrier of entry (a few million and a year or two for all the approvals, so feasible with investor backing if you have a valid business reason to make a payment processor) but it's being done regularly and also you can buy and rebrand an existing one, which is a common way to get a quicker market entry at the cost of a bit more money. However, that new processor will be a member of some existing payment systems e.g. Visa network and bound by all the same constraints as the other processors there. Creating your own alternative to a payment system (e.g. a major, widely and internationally supported card network like Visa or MC) is not really plausible. Perhaps you can look at the whole setup of cryptocurrencies+all the crypto exchange companies as something like such an alternative system, so there's one alternative made in this millenium.

Mvandenbergh 5y ago

It is. The problem is connecting to the rest of the financial system. Imagine starting an "ISP" that had not upstream connectivity. It wouldn't be an ISP then. Same problem here. There's a few players here: payment gateways, this is a service that provides the checkout service on a website and handles protected credit card information. Payment gateways also provide anti-fraud services. payment processors, these execute the actual transaction. They are members of card associations like Visa and connect the card issuing bank and the merchant bank of the payee. merchant banks, these are the banks that hold the company's bank account that the funds from the payment processor come into. card associations, Visa/Mastercard these provide the connectivity and set the high level rules. card issuers, these entities extend credit and may be retail banks or other parties. there is a difference between Amex/Discover and Visa/Mastercard in that the former are also the issuer. That's why you also see Visa debit cards in Europe, they're using the payment processing network but not extending credit. It should be clear that starting a new payment gateway is trivial. It takes money to properly comply but ultimately this is a software business. Starting a new payment processor is much harder but it doesn't matter because all payment processors must comply with the card association rules to get access to that network. Starting your own card network would require attracting issuers who would then issue cards that people could use to pay for OnlyFans... probably not realistic! It was the threat by Visa and MC to cut them off that was the killer here, plenty of payment processors would be happy to take their money but not if the card networks ban the company.