The biggest thing payments processors are concerned about is fraud. Certain lines of business are risky because they simply result in more fraud, plus there's a whole other level of restrictions enforced by the banks themselves. I don't know what the exact reasoning was behind the ban in the article, but there are entire teams dedicated to developing risk models that attempt to identify merchants that will end up resulting in a loss before it happens.

Payments processors like PayPal may just be middlemen between banks, but if the merchant owes the bank money and is suddenly nowhere to be found, the processor is the one who takes the hit.