The Future of iGaming Payment Processing – How your company can adapt to it.
It is a known prerogative that companies in the iGaming industry operate in an extremely competitive market, where no base can be left uncovered. Swift, hassle-free, and secure payment solutions form the fundamental structure of iGaming platforms and therefore, they have been at the forefront of innovation in the same. In the following article, we look at some of the most interesting developments in the iGaming industry’s payment processing that pave the path for the future along with certain challenges that might come in the way. We also touch upon certain characteristics that would help your iGaming company to expand beyond territorial borders and into different nations.
Latest disruptive developments in the industry
The online gaming industry has seen a meteoric rise in recent years. According to a Juniper research, online gamblers are going to wage nearly a trillion dollars by 2022 and the number is supposed to grow even further. With such figures of evaluation, let us look at some of the most interesting and path-breaking developments being observed in the iGaming payments industry.
- Accepting crypto payments
Given the rising popularity of cryptocurrencies, gamers and gamblers find it more convenient and secure to transact in them. Merchants are constantly adapting to this change and providing integrated crypto payment options as deposit/withdrawal methods for their users. The advantages that cryptocurrencies offer in terms of real-time, automated processes with no hassle of exchange rates based conversion or extended transfer time, make them extremely desirable, especially for companies in the iGaming industry.
- Player centric approach and data safety
An enhanced player-centric approach is being taken by the new companies in the industry, based on streamlined deposits, better acquisitions, automated payouts, and reduced failures. There is also an assurance to better protect a player’s data, preferably through (SSL) Secure Socket Layer encryption.
- Ensuring the presence of multiple payment methods
Alternative payment methods have grown significantly in popularity over the recent years and have even taken over the traditional methods by various markers. Some examples include PayPal, Apple Pay etc. They provide consumers with a faster and more tailored way to make purchases and in 2021, accounted for nearly 55% of the global e-commerce transactions.
- Adopting technology – AI, tokenization, and more
iGaming vendors and operators are incorporating the use of artificial intelligence to better understand their users, making AI one of the most promising trends in the industry. It sufficiently aids even in the processes of Fraud Analysis, Data Protection and cross-platform payment transactions. Along with this, tokenization is another method that is being readily used to secure a user’s data and eliminate the need to re-enter information. Although, still in its nascent stage, there is an advent of wearable payment technologies as well. Here, gadgets like smartwatches can be used for contactless payments on iGaming industry platforms.
The latest developments and trends on the technology front in iGaming industry’s payment processing are generally promising. There is also a greater shift towards ensuring a better experience for the user. However, certain issues must be kept in mind while these developments see more progress.
Challenges of Gaming Payment Processing – “iGaming”
It is important to note that developments in an industry must be directed towards dealing with the potential challenges at hand. In this section, we look at some of the glaring issues that need to be resolved for making considerable progress in improving iGaming payments.
It is quite possible for gamers on an iGaming platform to issue chargebacks due to huge losses. It’s a natural risk for online gambling and gaming and companies should be prepared for frustrated users as well. Friendly Fraud actually refers to the practice of wrongly requesting a chargeback for a legitimate transaction. Partnering with a payment processor who understands the industry’s needs is thereby, extremely essential.
Online gaming comes with the risks of the presence of cybercriminals. ThreatMetrix’s Gaming and Gambling Cyber Crime Report stated that one out of every twenty new gambling accounts present online is fraudulent. It is very important to be equipped with the right fraud prevention tools when setting up your gaming merchant account.
- Standard of Cryptocurrency
It is not possible for every online casino or gaming platform to adopt cryptocurrency and as discussed previously, it is definitely becoming a very popular choice among gamers. Also, crypto transactions follow a completely anonymous path which makes it difficult to track the payment in any case. Adapting to such disruptive changes will be quite a task.
The legal restrictions in various jurisdictions and the increasing number of compliance requirements can be a major issue in iGaming industry payment processing. Given the risky nature of the business itself with the high-volume turnover, age restrictions and a myriad of laws, it takes good effort to adhere to every compliance requirement. It is an area where no compromises can be made. Combining that with general issues like player acquisition and retention of customers legally creates a substantive amount of backend work for the iGaming industry platforms.
- A Global Arena
The most important challenge to be overcome is to integrate a sufficiently swift system of currency conversion given the global nature of iGaming industry platforms. It is essential to ensure that money could be directly sent to various beneficiaries and in the appropriate currencies. Providing a seamless payment experience along with an interesting and seamless gaming experience is what will ensure steady growth for your iGaming company.
Overcoming these challenges with innovative methods is going to be vital for the development of the iGaming industry. However, an essential characteristic that actually determines the future of iGaming payment processing is the expansion and growth of the business itself.
Expanding your business across various jurisdictions
The ultimate future of the iGaming industry lies in the process of expanding your business across various countries. Payment processing and expansion will thereby go hand-in-hand, facilitating each other’s growth. It is therefore important to primarily understand cross-border payments and then learn about creating growth with your gaming website.
Cross-border payments are essentially transactions where the payee and recipient are in different countries. To successfully execute these, iGaming industry’s platforms and concerned merchants should work with Payment Service Providers (PSPs) that provide a secure and global payment gateway with the inclusion of certain assisting characteristics like multiple payment methods. It is also essential to review the kind of popular payment options in a target territory and augment your payment platform according to the same. An example is the widespread use of eWallets in China documented in a Mckinsey report. They generated close to $43 billion in 2019 alone, far exceeding the global measure of $22 billion. These kinds of local preferences must not be neglected, especially as an iGaming platform, given the ease of transactions expected by the end-user.
The growth of a company in the iGaming industry to different jurisdictions begins from a good amount of research. Finding out the most popular payment method in that region is a good place to start. It should then be coupled with the right platform, reputable payment providers, and excellent customer service. It should be noted that other than your product, the provision of a seamless and efficient payment system is the most crucial aspect of ensuring steady expansion. A fraud detection system and good emergency support is also a necessary requirement for consolidating your position in a new territory.
A final step to starting your business in a new jurisdiction will be to obtain the requisite gaming/gambling license and adhering to the concerned regulations. The future of the iGaming industry’s payment processing industry seems to be very exciting and an ambitious company will surely want to be a part of it. Although, there are challenges along the way but with the right approach, the right information, the right strategy and the right support, it can well be accomplished.
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