PayPal Faces Restrictions on Steam Due to Banking Partner's Decision

Valve has revealed that a banking partner of PayPal has blocked all Steam transactions due to the ongoing controversy surrounding explicit content on the platform. This issue emerged last month when players and Valve noticed that PayPal was immediately terminating the processing of Steam-related transactions. However, it is not PayPal itself that is blocking these transactions, but rather one of its acquiring banks that has chosen to stop processing any Steam transactions, thereby cutting off PayPal support for several currencies. Currently, the affected currencies are all those except the Euro, British Pound, Japanese Yen, and Australian, Canadian, and U.S. dollars. Valve stated that the restrictions are related to content on Steam, which is similar to the previous concerns raised regarding Mastercard. The company explained that one of PayPal's acquiring banks decided to stop processing Steam transactions, resulting in the loss of PayPal support for multiple currencies. This development follows a denial by Mastercard that it had raised concerns over adult content on Steam, which Valve has disputed. The situation began when Mastercard communicated with payment processors and their acquiring banks, leading to the rejection of Valve's policy on distributing games that are legal for distribution. The payment processors cited Mastercard's Rule 5.12.7 and the risk to the Mastercard brand as the reason for their decision. Recently, itch.io also removed adult content from its browse and search pages due to pressure from its payment processors. This move came after a conservative campaign group called for payment processors to stop supporting gaming platforms that host adult content, including rape, incest, and child abuse games. For a deeper understanding of the situation, read our feature on the crackdown on adult content on Steam and itch.io.