There has been lots of excitement among US gambling operators during the two years with many states reopening for on-line casino, poker and sportsbook.
However, amongst the many challenges of individual state licensure, selecting an optimal suite of payment options is vital to securing a customer that has been acquired at a high cost.
Despite significant market penetration by credit and debit cards in the US, deposits into players’ accounts via cards have not been a predominant payment option for most US residents.
The largest Issuers, like JPMorgan Chase, are still safeguarding their cardholders and tend to deny authorization with gambling operators. Some Issuers like the Fifth Third Bank restrict “any gambling transactions”; specifying this in their Card agreement.
Bank of America has stated “…we may deny authorization of any transactions identified as Internet gambling”.
Adding to players’ frustration several states have restricted the use of credit cards and any other type of transaction that provides payment on credit with gambling operators.
PayPal and other wallet providers have not solved the issue with the poor acceptance rates. Cardshemes and Issuers treat card deposits through PayPal, Skrill, and other wallet and reloadable pre-paid card solutions as gambling as well.
ACH transfers remain dominant for many gambling operators.
Marketed successfully, however, small-amount non-reloadable pre-paid cards may still gain popularity amongst subgroups of US players.
Collaboration between on-line gambling operators and land-based casino resorts will further facilitate the growth of specialized wallets and gambling resort co-branded cards thus allowing on-line operators to acquire fully “KYCed” customers, and reward those customers with points.
Please let us know if you would benefit from a one-hour consultation or would like to engage our team to assist you with selecting an effective suite of payments or any other operational challenges.
Olga Bencini, Payments professional