BANKS, CREDIT CARD BRANDS, INTERNET PAYMENT COMPANIES AND THE ADULT INDUSTRY

Dec 11, 2015

“Don’t let the fear of losing be greater than the excitement of winning.” – Robert Kiyosaki

PayPal, Visa/MasterCard, JPMorgan Chase, and Square have systematically stayed away from businesses or customers who are involved in the adult industry. What has changed in the industry?

Denied Or Closed Accounts

According to a federal appeals court, forcing MasterCard and Visa to stop their cooperation with businesses with speech-protected websites is a violation against the First Amendment rights.

As account holders state, the major payment processors put forward an unclear policy concerning risk assessment, obscenity, or adult-content prohibition. Moreover, activities connected with adult businesses are put alongside narcotic sales.

In 2014, Chase held a campaign, targeting adult-industry bank account termination. PayPal is considered as the most famous company in this regard. It has systematically denied service, seized accounts and frozen funds for those being related to online adult content, no matter educational or artistic.

According to PayPal’s Acceptable Use Policy, the company’s services aren’t for activities related to transactions involving items considered obscene or adult-oriented materials and services.

In March 2014, PayPal closed its integration with Patreon, a subscription-model crowdfunding platform. The reason was the adult or NSFW content on Patron’s site. The latter decided to remove PayPal as a payment option for the creators’ of the content.

Blaming Other Companies

PayPal blames credit card companies, WePay blames Visa and big banking, Square blames Chase’s Paymentech, and Patreon blames PayPal.

According to WePay, acquiring banks and credit card brands usually restrict any payment processing for activities that are unlawful, brand damaging or high risk.

In 2012, PayPal told book publishers All Romance Ebooks, Bookstrand and Excessica to remove online titles considered obscene by the company. As a result, the book publishers removed the required content from their catalogs. Visa and MasterCard showed no involvement in the decision made by PayPal.

Adult business owners looking for the best solutions to their business needs should consider turning to emerchantbroker.com. With chargebacks under a 3% benchmark, your adult business can get a secure and reliable adult merchant account with the lowest rates thanks to EMB. You will enjoy fast approval and efficiency, and won’t be required to have your own Visa or MasterCard registration.

Rules And Policies

The Federal Deposit Insurance Corporation clarified its rules concerning “high risk.” First Amendment protections for websites were strengthened by a federal judge.

This is thanks to Operation Choke Point, a federal mess launched in 2013 by the US Financial Fraud Enforcement Task Force or FFETF.

In the FDIC’s new guidance document for banks, “reputational risk” is omitted. It’s high-risk categories specify fraudulent services or goods, and tactics – “aggressive telemarketing or enticing and misleading pop-up advertisements on Websites.”

FDIC defines “unlawful Internet gambling and the illegal sale of tobacco products on the Internet” as high-risk sectors. However, PayPal’s items considered obscene and adult-oriented materials or services are not labeled as high risk.

Let us help you get a high risk merchant account today!

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Having a merchant account allows an account holder to take advantage of merchant cash advances. When a merchant is approved for an advance, the business agrees to receive a lump sum of cash in exchange for an agreed-upon percentage of future credit card sales.

Pricing varies depending the merchant’s industry, past credit card processing history, the type of business seeking the account, average ticket sales, and average transaction volumes.

Yes, EMB works with merchants who are building their credit, as well as those who have poor credit. EMB also approves merchants that have no credit card processing history and businesses that have lost their merchant accounts due to high chargebacks.

Several factors influence a merchant’s risk level. Though only one factor likely will not get a merchant classified as high risk, a combination of these may: business size, location, and industry, credit score, credit card processing history, a industry’s reputation for excessive chargebacks, a prior history of high chargeback ratios, and whether a merchant exclusively sells online.

Virtual terminals are stationed on a merchant’s website, making it easy for customers to make a payment or purchase online. Merchants or a payment processor can easily set up virtual terminals, so online businesses can accept credit and debit card and e-check transactions.

A merchant account is a business account with an acquiring bank. Without this business account, which actually works more like a line of credit, a merchant cannot accept and process credit and debit card transactions. Businesses need a merchant account to accept major credit cards via a static point-of-sale terminal, mobile card reader, or through a virtual payment gateway.

After filling out EMB’s simple online application and submitting any necessary, requested documents, many merchants get approved within 24 and 48 hours.

EMB specializes in working with high-risk merchants. EMB works with many merchants, including but not limited to businesses in these industries: gambling and gaming, adult entertainment, nutraceuticals, vaping and e-cigarettes, electronics, tech support, travel, high-end furniture, weight loss programs, calling cards, e-books and software, and telecommunications.

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