Gambling payment gateway

Сorefy’s payment gateway solution connects gambling businesses with multiple payment providers conveniently and easily.

What is a gambling payment gateway?

A gambling payment gateway solution means a payment gateway that works with online gambling merchants or businesses. To make this concept clear, we should define the payment gateway solution first and then drill into what online gambling and betting is to understand how payment services for gambling industry differ.

Payment gateway is a technical solution for business that helps to handle online transactions securely. Namely, it is responsible for authorisation. In other words, it encrypts transaction details and transfers them from the merchant’s site or app to the payment processor or acquirer, receives a response (approval or decline) from them, and forwards it back to the merchant’s web application.

In its turn, online gambling is a type of activity that implies risking money for a chance of winning more money — for instance, participating in lotteries, online casino gaming, like roulette, or card games, like poker or blackjack. It is considered a high-risk industry by banks and payment service providers.

Global online gambling is a large market, expected to exceed $112 billion by 2025, with regulation being the main growth barrier. That’s because each country has specific laws regarding gambling industry, and companies providing such gambling operations and services have to comply with local laws to enter new markets.

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Top 5 payment challenges gambling businesses face

Here are some of the complexities different types of gambling platforms commonly have to deal with.

Getting a gambling merchant account

Due to the high financial risks involved, it’s not easy for an online gambling business to get a merchant account. Acquiring banks and payment service providers are cautious about providing accounts to companies in this industry.

Still, you need a merchant account to accept gambling and casino payments from players and pay them out rewards or winnings. To make it possible, make sure your company meets all regulations and has the licensing or certification needed, collect all the documentation providers’ ask for and prove you’re a transparent and trustworthy business with a clear history.

To increase your chances for merchant account approval, try to get in touch with providers that specifically offer services to online gambling businesses.

Choosing payment methods

It’s quite challenging for an online gambling business to provide all the payment options customers want, taking the industry specifics into account. First of all, some players are reluctant to use credit cards for gambling payments because they don’t want such transactions to be reflected in their bank statements. On the other hand, customers may just want to pay with their preferred payment method, be it a bank card, a digital wallet allowing them to pay in one click, or a cryptocurrency.

Businesses should do their research to provide customers with methods they’re most likely to use, focusing on geographies and industry statistics.

Handling both payments and payouts

It’s crucial in online gambling to be able to accept and make money transfers through multiple different ways, from credit cards to cryptocurrencies, ensuring high conversion and speed.

Look for an omnichannel gaming payment gateway that offers equally robust processing capabilities for both incoming and outgoing transactions. Such solutions may charge higher fees, but they’ll recoup in terms of consumer satisfaction.

Chargebacks

Online casinos often suffer from chargebacks and refunds. Every gambling application should keep in mind that if their chargeback rate exceeds 1%, credit card processors can block their merchant accounts.

To keep the chargeback rate of your gambling merchant account lower than 1%, you can rely on chargeback minimisation features and practices your gateway offers. You should also focus on making every step of the payment process clear for the player, properly store details on every online transaction and improve your consumer service to peacefully solve any issue with users. Remember that full refunds will cost you less than chargebacks with their fees and risks.

Unfavourable conditions

This point is for all other complexities and financial risks online gambling faces.

For example, as a high-risk industry, it has to pay higher fees for gateway services than other fields.

It frequently suffers from fraud, especially so-called friendly fraud, and at the same time has to prove it’s not fraud itself.

Many online casinos have a high turnover, which increases the suspicion gateways and processors have about them, as large volumes are hard to monitor.

And of course, strict regulatory requirements and their diversion across the world makes compliance a burden for online gambling payment processing.

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How to choose a payment gateway for online gambling?

The first question to ask when choosing a gateway is to what extent does a gateway help to solve all the challenges mentioned above. Ensure the solution you’ll partner with contains all the features needed to fulfil your industry-specific business needs.

Namely, it should allow you to accept online payments and make payouts to players through different payment methods.

The payment page, or checkout, must be user-friendly and intuitive, allowing customers to choose the preferred option and pay by clicking a few buttons.

Long and complex payment forms ruin conversion rates.

The gateway also must be compliant with regulation and security standards, like PCI DSS. It will help you build trust among customers and safeguard their payment data and transaction info.

Another thing that matters is how much a gambling gateway charges. Usually, gateways charge various types of processing fees: setup fee, monthly fee, per transaction fee, etc. The amounts also differ from gateway to gateway, so make sure to calculate expenses in advance to choose the best offer.

If you’re an international business, it’s important to check the geographical coverage a chosen gateway solution has. Sometimes you need more than one gateway to fulfil your business needs across all regions. For cases like that, Corefy, a platform that allows working with multiple payment service providers conveniently and easily, is a go-to solution.