>it's because chargebacks

Sorry, but that's just bullshit. This is nothing more than your standard pseudogovernmental meddling in the "just build your own financial infrastructure" vein, and it's coming from foreign countries this time rather than the US itself (it currently has an administration less hostile to business).

Then why there are chargebacks in the first place? Allow merchants to have no chargeback policy.

What merchant wants to have chargebacks? They exist for consumer protection not for the seller's benefit.

US federal laws mandate chargebacks as a consumer protection mechanism, primarily through the Fair Credit Billing Act (FCBA) of 1974 and Regulation Z of the Truth in Lending Act (TILA)

Why does this not apply to payment methods like Zelle?

Zelle is (in effect) a wire transfer - there is no "credit" (meaning "borrow now, pay later") for that law to apply.

To expand a little on this, Zelle and debit card transactions are covered under Regulation E: https://www.consumerfinance.gov/rules-policy/regulations/100... . So there’s a codified procedure for disputes, it’s just a little less consumer friendly.

Patio11 has a fantastic writeup on exactly this: https://www.bitsaboutmoney.com/archive/regulation-e/

In the US can you use stripe with only online bank transfers just like in the EU?

The US doesn't really do bank transfers the way we do here.

There's CashApp / Venmo / Zelle, previously Paypal, for P2P transfers (paying your friend for a half of the pizza you both just ate), but that's largely an internet phenomenon. There are wire transfers, but those are expensive and largely for big-ticket items you don't buy that often, think cars or houses, not TVs. There are ACH transfers, which is how wages and bills often work. The fun part of ACH is that the person executing the transfer doesn't have to be the account owner, so businesses can just transfer bill payments from your account to theirs. And then there are the famous checks, which work when no other option is available.

Non-purchase person-to-business transaction are largely done via credit card, sometimes by check or ACH. Explicitly instructing your bank to send a transfer to an account number provided by the business, either through a form or through a "quick transfer" UI, is very rare on that side of the pond.

This is the common explanation I see when this topic comes up, but it always made zero sense to me. It frustrates me that people fail to realize the amount of purchaseable things that could qualify as 'explicit'. This is Kickstarter. Do we really think that someone crowdfunding a risque board game or comic is as likely to ask for a chargeback as some middle-aged man trying to hastily cancel a subscription on some porn site?

And there's just so many more things you can pay for. Physical stuff. Art prints and comics. Game mods. Art commissions. Services that aren't just video platforms (social media, hookup apps and so on). There's so much more stuff out there that's not child-friendly, and I bet that all of these categories have different amounts of financial risk atrached to them.

So why are all these different things grouped under the widest net, with the worst offenders being used as reason to deny processing to the entire market segment? Why did they ban all explicit content and not just porn site subscriptions or whatever else has the most chargebacks?

This comment thread is confidently trying to steer around this topic, but there is ideology mixed up in this, and probably to a way larger extent than you think.

How do you define the difference between explicit content and porn?

When we're talking about the examples people bring up in this comment section to illustrate high chargeback rates ("Uncle Derek bought a $500 subscription in a stupor and his wife is about to find out"), the definition would be something like "live action video recordings of humans engaged in sexual activities". Explicit content is a superset of that, also including all the other examples I gave.

Note that I'm not saying we should ban that. I'm just saying that if the 'unbearably high chargeback' excuse had merit, they would've been precision-striking just those categories of sales, instead of opting to nuke everything that humans find sexual, regardless of medium, type of product/service, artistic merit, popularity and so on.

Note that, under my reading of these rules, Baldur's Gate 3 would not be allowed on Kickstarter. Nor would Mass Effect, since it has "sex acts or implied sex acts" (depending on what they mean by "implied").

Why are they casting such wide net? I’ve always wondered the same thing, my experience with adult content in the digital advertising world is that there’s a group dynamic that emerges and all but erases the “political will” that would cause certain businesses to make the first move in clearly defining what they carve out categories are, so it all backslides into fairly broad categories. It’s lot of heat in some scenarios and it paralyzes companies (motives varying depending on market position and situation of course)

> You can use your imagination to come up with many reasons these result in more chargebacks than normal purchases.

No I can't. Can you elaborate?

The canonical example is person A buys some risque item, their partner sees the credit card statement says "what is this?", so then person A denies they made the purchase (because they are embarrassed), says it must be fraud, so then it gets charged back on the credit card.

They do not have SMS OTP confirmation for bank card purchases? It is much more difficult to deny anything when there is a record of delivered SMS message along with phone identifier and precise location.

User uses a credit card, either a legitimate one or a stolen one, to buy access to a site. They download all the content that their purchase gives them access to. Then they (or the card's legitimate owner) initiate a chargeback. They "lose access to" the site but they already have everything that's there for free, and they add it to their library of other stolen content.

I really struggle with realistic use cases for stablecoin payments (many are more gee-whiz party tricks or they are reinventing the problems of traditional finance but on a blockchain) but adult content / tipping is an interesting one... small transaction size + high chargeback rate, feels ripe for this

>For specifically sexually explicit stuff, it's because chargebacks are __significantly__ higher for these types of purchases.

This has always been a lie. I work preventing stolen credit cards from being used to buy gift cards.

Payment networks do not at all care about cutting you off for having chargeback heavy flow. They demonstrate their value to customers by supporting those chargebacks, they make $20 for every single one. If you have a large fraction of your payments causing chargebacks, they just charge you more money for the privilege. They won't cut you off unless you are obviously not doing anything to prevent credit card fraud or are party to the actual fraud itself. Payment networks don't even do that much to prevent fraud, because it doesn't hurt their business at all. Everyone knows you are protected when you use a credit card, and frequent demonstrations help that.

This has always come down to some fundamentalist "Christian" groups who keep spending big bucks suing anyone they can find who sells anything adult, and suing Visa and Mastercard as accessories. They are trying to ban porn, toys, adult content in general.

https://en.wikipedia.org/wiki/National_Center_on_Sexual_Expl...

This is the group that drove Pornhub to delete 9/10ths of their library.

Compare their efforts to the australian group who got so much flak for demanding steam remove violently rapey games and yet are fine with steam still being full of sexually explicit games that aren't about simulating abuse.

I can't understand why people believe this lie. If it were true, you would not be able to buy a gift card over the internet at all.

> They are trying to ban porn, toys, adult content in general.

They see all LGBT stuff as porn. Which is why the current moral panic in US/UK involves transgender people. Once trans people are outlawed, the rest of the rainbow will be rounded up and eliminated.

I wish they could just raise the fees to account for the chargebacks so at least it's not banned entirely.

So is this specifically for "MILFs/DILFs" or "buttocks"?

Because this is too specific for your understanding of the reasons to be true. They'd just blanket ban anything NSFW.