Why Does the Adult Industry Have Problems With Credit Card Companies?

Financial discrimination against the adult entertainment industry encompasses a range of unfair and unequal treatment experienced by individuals and businesses involved in the adult industry. 

These practices of hindering the industry’s ability to access financial services and resources are a product of climbing barriers to entry, growth, and short- and long-term economic stability. We have written about financial discrimination in the past but, in this article, we will dive deeper into the further dynamics of financial discrimination faced by the entire adult industry. The Adult Site Broker blog team will add context to the crisis of ongoing financial discrimination against adult.

Many financial institutions, including traditional institutional banks, are reluctant to provide any banking services to companies and individuals operating in the adult entertainment sector due to perceived reputational risks. As a result, adult entertainment businesses face difficulties in simply depositing funds, processing transactions, and accessing basic financial services like loans and credit lines. Without proper banking support, these businesses may struggle to also manage their finances efficiently and may face obstacles in day-to-day operations. As a result, individual sex workers also face banking discrimination resulting in the closure of accounts and claims that simply working in adult entertainment is a so-called indication of “high risk” activity.

Payment processing issues are also another major concern for the adult entertainment industry. Established payment processors, such as PayPal and Stripe, have strict policies against processing payments for adult content. This poses significant obstacles for adult entertainment businesses, as they struggle to find suitable payment processing solutions to receive payments from customers. Without efficient payment processing options, these businesses may lose out on potential sales and revenue streams, hindering their financial sustainability. Major credit card companies also are complicit. The Free Speech Coalition, a trade group representing most adult entertainment companies like ours, researched and published a notable white paper on financial discrimination with Sex Work CEO – the site created by pornstar and activist MelRose Michaels. 

Mike Stabile, the director of public affairs for the Free Speech Coalition, told journalist Gustavo Turner of XBIZ that “the rampant financial discrimination against the adult industry is devastating to our businesses and workers.From predatory fees to unwarranted fund seizures, financial institutions are exploiting the labor of those working in the adult industry. This report shines a light on a shameful practice,” Stabile said. Stabile has been on our podcast, Adult Site Broker Talk, as has FSC Executive Director Alison Boden. The report indicates that nearly 2 out of 3 people earning money in the adult industry have said they lost access to a bank account or another financial tool. 40 percent said they had a banking account closed within the past year. And the report said that the issues adult businesses and workers face concerning financial products – banking products, mobile payments, credit cards, loans, and insurance – are unique and have never been fully documented in such an open and clear analysis showing the impact of the banks and other powerful players in the financial segment on censorship and sexual speech.

Note, not all financial institutions or individuals engage in financial discrimination against adult entertainment performers. However, the systemic biases, social stigmatization, and industry dynamics outlined above contribute to the challenges and discrimination faced by performers in accessing financial services, stability, and opportunities. Sex work will always be controversial.

Financial discrimination against the industry also has broader implications beyond just financial challenges. It contributes to the marginalization and stigmatization of individuals and businesses associated with the industry. By excluding these businesses from mainstream financial services and imposing additional hurdles, society, unfortunately, reinforces the notion that our industry is inherently illegitimate or unworthy of fair treatment. Fairness is necessary, however. This social stigma not only affects the financial well-being of those involved but also perpetuates a cycle of discrimination and exclusion. Noteworthy efforts to address financial discrimination against the adult entertainment industry are gradually emerging. Some financial institutions and payment processors are starting to recognize the need for more inclusive policies and are willing to work with adult industry businesses. The Free Speech Coalition notes one legislative intervention to help.

Republicans in Congress introduced the Fair Access to Banking Act in an attempt to codify the former so-called Fair Access Rule promulgated by the Office of the Comptroller of the Currency (OCC) a little-known office in the U.S. Treasury Department, during the presidency of the former president, Donald Trump. Officially the Fair Access to Financial Services Rule, the Trump OCC issued a regulation that prohibits the nation’s largest banks from refusing to lend funds to some of the more controversial industries around, including adult entertainment. According to Banking Dive, the rule would’ve prohibited banks with more than $100 billion in assets from denying any services to firearm manufacturers, energy companies, and operators of private prisons, among other industries considered controversial. However, due to pushback from the banks and other groups claiming that the OCC overstepped, the rule was overturned by President Joe Biden’s appointee to lead the office upon the change in government after Trump lost the 2020 election.

The Fair Access to Banking Act is endorsed by the Free Speech Coalition. Despite the so-called “woke corporate cancel culture” the bill was introduced to prevent, the act is also supported by trade groups including the Blockchain Association, National Pawnbrokers Association, and the National Mining Association. Other organizations that support the bill include other groups that don’t necessarily jive with the Free Speech Coalition’s mission, including right-wing groups like the National Rifle Association, National Shooting Sports Foundation, and other organizations.

Regardless of the industry or political message, there is an interest in ensuring equitable access to financial resources across the country. We will be following up in the future on the status of financial discrimination against the entirety of the international adult entertainment industry.

Read more from the Adult Site Broker blog:

Financial Discrimination In Adult Entertainment

How OnlyFans Is Impacting The Adult Industry

The Tumblr Tumble: How A Once-Popular Platform Lost Its Way

The Future Of Artificial Intelligence (AI) Porn

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