You are in the midst of forming your adult entertainment business in preparation for a fabulous launch that reaches a wide swath of customers and meets their needs in ways above and beyond what your competitors are doing. 

Then you go through the process of applying for payment processing services – only to discover that the “conventional” financial providers want nothing to do with your 100 percent legal company and its clients. What exactly has led you to become such a pariah?

The complex adult entertainment ecosystem

Whether you want to open a dating company or a webcam business or wish to focus on selling toys and accessories, your store will automatically be relegated to the “high risk businesses” category. 

There are several factors that contribute to this unavoidable reality.

More regulations

There are additional regulations that have been put in place to protect more vulnerable members of society. As a result, your services are off limits to under-age customers, and you must take additional steps to verify that visitors are legally eligible to enter your website. Financial companies want to focus on the lowest-risk payment experience. 

Therefore, they avoid partnering with stores like yours that could potentially violate the law or, at the very least, might require additional money and effort to remain aboveboard.

Higher risk of chargebacks

When customers directly contact their credit card company and request a refund for your services, this is known as a chargeback. Dealing with this funds reversal can cost you a good deal of time and money. 

Conventional lenders want to avoid collaborating with any site that is statistically more likely than the norm to incur increased chargebacks. That’s because too many of them can actually be fatal to a new business fighting to build a strong reputation.

Reputational issues

Traditional lenders are very aware of the impression they make. Like it or not, most of them are not willing to have their name associated with a business that specializes in adult-oriented entertainment, images or products.

Transaction types

By their very nature, the online payments processed by ecommerce companies like yours are card-not-present. In other words, the physical piece of plastic from the customer’s Visa, Mastercard, American Express or Discover card is not physically present and visible to the merchant when the services are being bought. 

Consequently, the potential for identity theft and fraud is much higher, making conventional payment processors all the more squeamish about taking you on as a client.

The solution for your high-risk adult entertainment business

You may well be a bit stunned by the news that standard processors like Stripe and PayPal have refused to work with you. You might even fear that this spells the end for your dreams of entrepreneurial success in the adult entertainment sector. 

Let us be the first to give you the good news: There are numerous reputable, dedicated adult industry payment processing providers who are ready, willing and able to furnish you with the full set of payment features you need.

A high risk payment provider with experience in your industry can bring unique advantages to the table that you would never receive from a conventional lender. Their experience in your sector means that they have built relationships with banks and other financial institutions, thereby making it easy and seamless for you and your customers to exchange funds for content and services.

They also understand the complex regulatory and security landscape in which your website must operate. As a result, they can provide you with the full range of payment choices and services, all of which are protected with the most updated security measures.

The disadvantages of high-risk payment processors

As you might imagine, furnishing you with this industry focus while absorbing the extra risks that come with the adult entertainment sector comes at a price. Consider it the cost of doing business. 

As such, you can expect to pay higher per-transaction fees and may be required to also spend more for ongoing services. In addition, the application process may take longer and require more burdensome paperwork.

Nevertheless, the benefits that a high-risk payment services provider will bring will outweigh these relatively insignificant logistical and financial obstacles. To sweeten the pot even further, your high risk payment provider will be available to give you prompt, expert customer service with the unique traits of your industry at the top of mind. 

This assistance will help you to get past any technical difficulties or training concerns that may arise. In the unlikely event of a security breach, your top-tier provider will be with you at every step of the way as you work to contain and mitigate the damage to provide the highest level of discretion and customer protection.

Launching and running a successful adult entertainment business is not for the faint of heart because of the complex regulations, reputational considerations and security landscape surrounding the industry. 

But with the right high risk provider at your side, you have every chance of success.