Canberra-based online sex shop files complaint against startups ZipPay, Afterpay

A Canberra-based online sex shop has filed a complaint with the ACT Anti-Discrimination Commissioner after two digital payment services have allegedly refused to accept it as a merchant. The shop’s owner said she was rejected by the buy-now-pay-later startups because the merchant is in the adult industry.

The Pleasure Box owner Deborah Avery said she wanted to be able to offer customers with Afterpay and ZipPay. “It’s my customers that are being discriminated against because they’re making a [moral] judgement,” she told Fairfax. In 2013, Avery ran for the federal senate as a candidate for The Australian Sex Party.

Afterpay allegedly told her it does not take on adult industry businesses as customers. On the other hand, ZipPay reportedly said it does not serve adult businesses with a turnover less than $10 million.

Peter Gray, ZipMoney co-founder and chief operating officer, told Business Insider that the company would not comment on “specifics of any commercial or risk decision.” But he said they were disappointed that the ZipPay name has been used in such fashion when a review of the industry would have identified that the company supports several retailers in this sector.

ZipPay is a brand of ZipMoney. ASX-listed ZipMoney landed $40 million of investment from Westpac.

As for Afterpay, it initially refused service to the online sex shop based on a compatibility issue with its website. When that was rectified, the fintech allegedly declined again, based on the industry that the business was involved in.

“The [adult] industry is not accepted right now because the industry carries an above average non-repayment/fraud rate on the consumer end, not because it is the adult industry,” Afterpay explained in an email to Avery, according to Fairfax. A spokesperson for the company told Business Insider that the company is only exposing itself to “certain categories of goods” to manage risks during its “early stages of operation.” The spokesperson added that as the business continues to expand, Afterpay intends to offer the service across a more comprehensive range of categories.

Afterpay was recently recognised as organisation of the year at the FinTech Australia awards. It also received praises by the FinTech Australia judges for its “strong, customer-centric” retail buy-now-pay-later solution.

The ACT Anti-Discrimination Commissioner cannot rule on complaints, but it can refer the matter to the defendant and facilitate a conciliation process. The case can proceed to the ACT Civil and Administrative Tribunal if a resolution cannot be reached.

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