Gambling payment processing: a brief grasp of current situation
Gambling payment processing remains the subject of controversy for many reasons. Gaming startups struggle to enter the industry due to the lack of transaction history and credit. Big online gambling businesses usually imply huge volumes of turnover and the vast majority of companies are established offshore. So, the major issue, for sure, is that many card processing providers perceive gambling as an industry of high risk.
Despite these facts, the industry is actively functioning and developing. Gone are the days when the only way to tame the gaming craving was to go out to a casino. More and more gambling companies are moving their businesses to the Internet. This is particularly true for online casinos, which have had a considerable boost over the last year. For instance, online gambling revenues increased sharply in Italy: if an online casino generated about 70 million euros in March 2019, this figure rose to 90 million euros in March 2020. Obviously, the main reason is the COVID-19 pandemic, which imposed certain restrictions and made people spend more time at home.
Payment methods in gambling
The latest innovations have not only promoted the expansion of the online gambling industry but also influenced gambling payment processing. The development boost has also caused certain changes in payment methods.
First of all, credit cards are not an option in certain geographies. Recent legislation changes in the UK made credit card payments on gambling platforms impossible. The reason is quite simple and even noble — make gambling fans stop building up massive debts on their cards. Still, the use of debit cards remains popular, but this method is tricky: it is risky to link a debit card to your account if you’re not sure about an online casino hack-proneness.
Another method that is slowly petering out is bank wire transfers. This happens due to the harsh fees and long-term settlement to a balance (in some cases the money can show up in your account in about a week).
E-wallets keep on the rise and prove that online gambling payments can be really secure. Offering an extra layer of security, popular e-wallets protect players from hackers and fraudulent actions. Moreover, certain e-wallets offer user-friendly and full-fledged mobile apps, promoting easy payments on-the-go.
Online gambling business needs
What do merchants usually expect from a gambling payment processing solution? Sure, there is no limit to perfection, but there are basics that are important for online gambling businesses.
- Hassle-free payments & payouts. Gambling implies both payments from the players and payouts — their winnings. So, smooth pay-ins and payouts are the basis.
- Range of payment methods. The best suitable payment method for a certain transaction is usually defined by its volume, geography, etc. As far as both merchants and players (payouts and pay-ins) can be different, it’s good for a payment solution to provide various methods.
Since merchants in the emerging gambling markets have no access to popular payment methods, enabling them to process local payment methods is a huge add to competitiveness.
- Recurring billing. The subscription model is quite popular, so supporting recurring payments is regarded as a plus.
- Integration with prepaid card providers. This option is convenient for many gamblers. Some cards can be easily reloaded and allow players to pay and get paid with no hassle.
- Anti-fraud mechanisms. As long as the reputation of gambling cannot be called a clean sheet, fraud and chargeback prevention mechanisms will not go amiss. Ideally, a payment solution should feature its own anti-fraud system, but taking advantage of third-party service providers is a way out too.
Future outlook: cryptocurrencies steadily advance
The popularity of online casinos that accept crypto payments — i.e., payments using virtual currencies — on gambling platforms is gaining momentum. This scenario is quite predictable since it’s about a universal currency that can be used anywhere and by anyone. It seems that the world of online gambling is the perfect place for crypto. And here are the reasons: security, reasonable cost and speed of transaction processing, and accessibility. Following the trends, cryptocurrencies appear among the most used casino payment options. In most cases, these are Bitcoin, Litecoin, and Ethereum. The advantages of this currency type are obvious — transactions are rapid, non-reversible, exclude deposit/withdrawal fees, and allow players to maintain their anonymity.
The online gambling industry has shown incredible resilience even amid the crisis. What will be the online casinos of the future? Optimists believe that bans on online gambling and unregulated online entertainment will drown in the past. Online casinos across the world will get licensed, gamblers will get ultimate security and control by the government. The latter will receive certain profits from such establishments. Small online casinos, most likely, will merge into single networks. These are only subjective assessments, although not devoid of credibility.
We at Corefy provide online gambling businesses with a reliable and stable solution that helps to process high-risk payments and payouts hassle-freely. Corefy provider hub offers dozens of integrations that allow for processing high-volume transaction flows and risk diversification. And our Routing & Cascading engine will pave the smartest way for each transaction to increase conversion rates and profitability. Relying on our solution allows you to optimise costs, mitigate risks, and maximise conversion.
Get in touch with our team and get the most relevant offer for your business needs.