Recent developments have seen Steam and Itch.io, two popular PC game storefronts, modifying their policies regarding sexually explicit content. This shift was prompted by pressure from major credit card companies and payment processors who have redefined what they consider acceptable material. Facing potential transaction blocks, both platforms are now requiring developers to adhere to broader and more restrictive definitions of adult content as dictated by their financial partners. This change has already resulted in a wave of removals and delistings on both Steam and Itch, impacting a diverse range of projects, from adult-themed anime games to indie titles marketed towards specific audiences.
An Australian activist group, Collective Shout, has publicly claimed responsibility for instigating the actions taken by the payment processors and credit card firms. They cite concerns about video games that, in their view, promote sexual violence and misogyny. However, the group’s motives have been called into question. Founded by an anti-abortion advocate, Collective Shout has links to groups with anti-LGBTQ+ stances and has a history of misrepresenting the content they aim to censor. Furthermore, they have been hesitant to provide specifics on the games they targeted or the methods they used to identify them, aside from mentioning the use of user-generated tags.
Developers and players impacted by these policy changes are actively voicing their opposition. A coordinated campaign is underway, urging individuals to contact companies like Stripe, PayPal, Mastercard, Visa, Payoneer, PaySafe, and Discover in an effort to reverse the current course. Meanwhile, these financial institutions are deflecting blame. Stripe claims they faced pressure from their banking partners, while Mastercard maintains they have not evaluated any games nor imposed restrictions on creator platforms.
The situation highlights the complex role payment processors and financial institutions play in regulating online content. To better understand this dynamic, communication was established with academics who have studied the role these companies have in governing online expression and enforcing standards for acceptable content.
Dr. David L. Stearns, a former Stripe engineer, former senior lecturer at the University of Washington Information School, and author of a book detailing the origins of the Visa electronic payment system, provided insights into the relationships between payment processors, government regulations, and the public. While his expertise doesn’t focus specifically on Steam, Itch, or the adult entertainment sector, he outlined how payment processors navigate their positions between financial incentives and regulatory compliance.
Here’s a simplified overview of the key players: Credit card companies and banks (Visa and Mastercard being the largest) are responsible for the vast majority of global credit card transactions. Payment processors, like Stripe, act as intermediaries licensed by credit card companies and governments. They facilitate the transfer of funds between the buyer’s bank or credit card provider and the seller’s bank.
The pervasiveness of Visa and Mastercard places them in a position of power, allowing them to enforce regulations by controlling financial activity. According to Stearns, payment networks profit from each transaction, but governments can use these systems to enforce policy.
To operate as a bank or move funds requires government licensing, subjecting these institutions to regulatory oversight. Stearns explained that if a government restricts payments for specific goods, banks and payment networks must comply to avoid fines or license revocation. Payment processors like Stripe are similarly tasked with ensuring merchants adhere to these regulations, often developing their own content policies reflecting those of the larger financial institutions.
The relationship between payment processors, credit card companies, and the adult content industry has been historically complex, due to the industry being frequently classified as “high risk.”
Stearns further elaborated that cardholders can dispute unauthorized, fraudulent, defective, or undelivered transactions. In such cases, the merchant is liable unless the transaction’s legitimacy can be proven. If the merchant cannot pay, the payment processor becomes liable.
High dispute rates from a merchant, especially for large sums, can lead to protective measures from payment processors and banks. They may require escrow accounts or, ultimately, cease handling transactions from that merchant to maintain the overall payment network’s integrity.
Stearns stated that recognizable adult content sites are susceptible to stolen card credentials and disputed transactions. Dr. Rébecca Franco, a postdoctoral researcher at the University of Amsterdam’s Faculty of Social and Behavioural Sciences, provides additional insights on how adult content creators conduct business.
Franco, who has authored research on the relationship between the adult content industry and financial firms, examines the inherent conflicts when corporations are asked to act as moral arbiters. She explores the transition from enforcing regulations into broad censorship to avoid legal action or reputational damage when groups like Collective Shout raise concerns.
Her 2024 paper on “payment processing and the moral ordering of sexual content” discusses how compliance can become intertwined with brand management, leading to broadened definitions of what is considered unacceptable. Payment processors or credit card firms might conflate illegal material, such as child abuse recordings, with content deemed harmful by influential groups.
This conflict is exacerbated when automated moderation tools are used, as these tools struggle to understand context. For example, AI cannot reliably distinguish between consensual BDSM and recordings of non-consensual acts. Another example involves videos being flagged as bestiality because of a pet appearing in the background.
In another paper on payment ecosystems and regulation of adult webcamming and subscription-based platforms, Franco explores legislation and litigation against credit card companies working with the adult content industry. She references the Fight Online Sex Trafficking Act and Stop Enabling Sex Traffickers Act, passed in the US in 2018, which hold credit card networks liable for sex trafficking related litigation. She also mentions a 2022 lawsuit against MindGeek (Pornhub’s former owner), including Visa as a defendant for allegedly profiting from “trafficking.”
Mastercard introduced new global moderation and verification requirements in October 2021, with Visa following suit in 2022. Franco’s paper suggests that these changes have negatively affected the income of adult content creators, especially queer, Black, kink, and fat sex workers who are often targeted by anti-porn organizations like Exodus Cry, a co-signer of Collective Shout’s campaign against Itch and Steam.
Franco suggests that Mastercard’s requirements may exceed legal requirements, driven more by profitability and market risk concerns than legal definitions of obscenity. Adult content is considered high risk due to social stigma and reputational risk, rather than transaction disputes.
Could the game developer’s efforts succeed in reversing policy changes on Steam and Itch.io? Stearns stated that it is possible.
Stearns explained that regulations are “squishy and negotiable,” and that even though lawmakers try their best to encode policies into laws, the end result may be too broad. If the regulations are perceived as unreasonable, the merchants can and have united to make their case in the court of public opinion.
Stearns continued that with enough pressure, lawmakers often clarify the regulations, or even amend the laws, to appease merchants and their customers.
Another common solution is to find alternative payment providers specializing in adult material, such as Segpay, Vendo, and CCbill. Itch recently announced that they were exploring this option. Franco supports this approach, noting that “some high risk processors will help merchants completely manage the relationship with the bank, which is helpful for platforms who might have difficulties finding a suitable bank that is willing to have them as a client.” Payment processors that cater to adult content may be better equipped to assist merchants in navigating the credit card companies and banks regulations.
However, this strategy also poses risks. Processors specializing in adult content might have higher fees and strict compliance requirements, like KYC. Trust is also crucial in selecting a payment processor. Franco noted the importance of finding an established processor, like CCbill, since some processors may not invest in compliance and have folded in the past.