Paypal doesn't have the profit margin to offset the risk factors in transactions for ''virtual'' porn transactions is my guessing. Also the merchant registration processes required by VISA and Mastercard (initial and renewal fees) are an administrative burden. If the adult processing business was profitable to them -- they would do it but maybe under a separate business name division I would speculate.
Truth is: There are to many sleazeballs in the porn business with their hidden and ''plain-site'' cross-sales and also card banging deceptions to make Paypal even consider doing adult processing directly.
So, they farmed the processing out to Epoch and are letting them handle the problems -- that is why the processing fees are what they are
