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Originally Posted by spunkmaster
No, they're not unqualified just because they are videos. All adult products, toys and Video that are shipped are just nornal ecommerce transactions and the banks wholesale cost is the same as if you're selling gift baskets.
Visa/MC doesn't restrict the Banks to sign up adult videos or products but they do have a different classification on adult memberships, pay per minute and pay per call etc.. The reporting and chargeback monitoring can be extensive on these merchants as well as the fines for violations and that's the reason banks don't want to process adult.
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I am not talking about shipped videos. I am talking about online video.
The idea that online video is riskier is absurd. Shipping a physical item is more expensive than bandwidth!
The different classification is used to "unqualify" all those transactions and therefore fix higher prices.
The extra reporting and monitoring are actions used to restrict supply; however, they do other things to restrict supply as well. The extra monitoring alone is not enough to stop a bank from making all that money!
The point is, banks are not allowed to make descisions and set prices like they can for other classes of products. (Kroger for example argues that all transactions even in their category are at inflated high prices because visa restricts competion for them as well)