Why payments are at the center of iGaming customer loyalty evolution

The battle between online sportsbooks and casinos is fiercer than ever before. The industry is going through something of a revolution as operators compete for player loyalty. Payments are at the forefront, with transactions something that gamblers are increasingly demanding on.

Speaking on the subject, Paysafe president of global gaming, Zak Cutler said: “Payments aren’t just a backend function — they’re a strategic growth driver. The more seamless the process, the higher the conversion, retention and overall user satisfaction. That’s where the industry is headed.”

In 2018, the Professional and Amateur Sports Protection Act (PASPA) was overturned. This triggered the legalization of multiple sports betting operators in the US. However, many operators were quick to launch, without first mastering payments.

Why payment operators are still getting to grips with the iGaming market

Banks had always prohibited gambling-related payments. Even with changes regarding legality, approval rates stayed supremely low. Continuing with his thoughts, Cutler said: “In those early days, you had all this marketing, all these new sportsbooks going live, and then … credit and debit card declines everywhere. Issuing banks weren’t on the same page as regulators, and if their policies didn’t explicitly allow gaming transactions, they simply didn’t process them.”

This led to e-wallets like Skrill and PayPal stepping up to the plate. Open banking solutions also came into play, with gambling operators searching for options to process deposits. Approval rates soon reached over the 90% mark as the iGaming market increased in legitimacy.

“Fast forward five years, and we’ve gone from very few ways to pay — with a ton of friction — to a well-optimized space with a variety of payment methods,” Cutler said. “Digital wallets, bank transfers, Venmo, Apple Pay, even cash-based solutions — players now have an array of options tailored to their preferences.”

DraftKings and other sportsbooks are considering introducing crypto payments. This is an excellent option for quick and secure payments. The likes of Bitcoin, Ethereum, and Tether also help you to remain anonymous

Gambling platforms, in particular sportsbooks, are now developing strategies to link payments and user experience.

Open banking has been active in Europe for many years. In Asia and Latin America, other payment methods are utilized. The US is playing catch-up somewhat, with best practices dictating their next moves.

“Look at Brazil — Pix accounts for the majority of transactions. In the Netherlands, iDEAL is the primary way to pay. Operators need to offer the right payment methods for each jurisdiction to maximize conversion.” Cutler said,

“If an operator like Bet365 is expanding into Latin America, we enable them to offer PagoEfectivo, SafetyPay and other regionally preferred methods without additional integration work. We’re seeing an industry shift where sportsbooks are becoming global platforms, and they need localized, seamless payment options across every jurisdiction they operate in.”

What do players look for when making payments?

Payment speed has always been important. However, gambling operators must now focus on integration too. This suggests that payments must be embedded into gameplay.

“Payments are one of the first interactions a user has with a brand. If a deposit fails or their preferred payment method isn’t available, they’ll leave and go elsewhere. Operators are spending significant money to acquire users — so every friction point matters.”

Embedded payments deliver an integrated gateway that features banks, e-wallets, and real-time options. Know Your Customer (KYC) and payment credentials is another area that gambling operators are working on.

“Think about it — if a digital wallet has already verified your identity, age and location, why should a sportsbook have to do it again?” Regulators need to get comfortable with streamlining these processes. The less redundant information users have to enter, the smoother the experience.”

Payouts are another area where changes are occurring. Real-time withdrawals are in demand, while e-wallets are often utilized.

“People want access to their money — fast. “If they’ve won a bet or have a balance to withdraw, how quickly they can access those funds determines their trust in a platform.”

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