Before they can lay down €10 on the 10/1 underdog or place their bets for roulette, players have a crucial step to take: their first deposit. Online casino and sportsbook operators need to know the payments landscape like the back of their hand to offer players in different regions the payment methods they need.
Credit cards like Visa and Mastercard are famously accepted worldwide, letting users everywhere make payments with a card, a phone, or even a watch. However, in the iGaming sector, they are not a one-size-fits-all solution.
Online casino and sportsbook operators who think that supporting payments from a few credit card giants means smooth sailing for their platform will find themselves in some choppy waters. There are more than a few markets where credit cards are not players’ first choice — or even an option at all – due to regulations or lack of access to financial products.
Gambling is often classified as a high-risk industry due to connections to organized crime, money laundering, and terrorism financing. Credit card issuers use four-digit Merchant Category Codes (MCCs) to identify the industry the merchant is part of. The MCC for private gambling operations — separate from government-run — is 7995. Suppose a credit card holder in a region where gambling is prohibited tries to access a gambling site. In that case, the credit card provider recognizes the MCC code 7995 and blocks the payment from occurring.
Aside from jurisdictions where gambling is banned, players might be blocked from making deposits with their card by stringent regulations, a spotty financial system, or the simple fact that they lack a formal bank account. Luckily, there is a range of other services players can use, such as:
- Bank or wire transfers;
- Instant transfers;
- Payment gateways;
- E-wallets;
- Cryptocurrencies.
To optimize their payment processing, online casino and sportsbook operators should familiarize themselves with the preferred payment methods of their markets of operation.
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Europe
The most popular payment methods across Europe are Visa and Mastercard. However, different regions have their local alternatives — particularly in jurisdictions that ban credit cards for gambling transactions.
In Germany, for example, regulations prohibit the use of credit cards for online gambling and betting. Instead, German players use Sofort, the leading payment provider in the German market. Sofort offers secure transactions with minimal steps and is also popular in Austria, Belgium, and the Netherlands.
With nearly 100% of its 67 million citizens using the internet, the UK is one of the largest e-commerce markets in Europe. And due partially to a cultural love of betting on football and other sports, the country boasts a massive gambling market. According to a 2021 report by the United Kingdom Gambling Commission, online gambling participation in the country has risen to nearly 18% (excluding those who only play the national lottery).
Due to regulations introduced to combat problem gambling, as of April 2020, the use of credit cards for gambling payments has been banned in the country. UK players commonly use their debit cards, services like PayPal, or open banking, a rapidly developing financial technology that uses APIs and open-source technology to increase security and transparency.
Inter-bank network Multibanco dominates the Portuguese payment space, with over 12,700 nationwide ATMs from 27 banks participating in the network. Multibanco’s online payment service, MB Net, guarantees security by generating a virtual credit card that keeps the details of the actual card secret from the vendor. Other popular payment methods in the country include card payments, PayPal, various payment systems, open banking, direct debit, and bank transfers.
Two of the continent’s most popular payment methods are Skrill and Neosurf. With both of these methods, third parties never access the user’s account details.
While users can make deposits into their accounts using a credit card, Neosurf primarily works on a voucher system. Vouchers are widely available at retail locations across the continent, and redeeming the code puts the value of the voucher into their account.
Digital wallet Skrill operates in 180 countries and supports payments in over 40 currencies. One of the world’s best-known payment solutions, Skrill is accepted by roughly 150,000 different websites and even has a VIP program where eligible users can make payments to other Skrill accounts without paying a fee.
Europe:
- Visa;
- MasterCard;
- Skrill;
- Neosurf;
- Sofort;
- PayPal;
- Multibanco;
- Open banking.
Latin America
While credit cards are the go-to option in the UK and the rest of Europe, they are far from the most popular choice in Latin America.
According to a 2020 report from MasterCard, only 55% of Latin American adults have a bank account, and only 19% have a credit card. Internet users across the region prefer to make online payments using bank transfers instead. During payment, they are either redirected to their bank’s payment page or choose their bank from the list of service providers or sellers of goods. In most cases, payment authorization occurs instantly.
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Payment processors are doubly important in some Latin American nations as banks and other financial institutions have a longstanding mistrust of the gambling industry and refuse to process transactions for sportsbooks and casinos.
The most popular local payment system in Brazil is Boleto Bancário, an official payment system regulated by the Central Bank of Brazil. The user can pay for the service via Boleto Bancário in cash at any bank branch or at an authorized supplier. Players can also make payments using one of 48,000 ATMs across the country, through mobile banking, or online. Similar systems are popular in other Latin American countries, like Mexico.
Latin America:
- Bank transfers;
- Boleto Bancário;
India
Online gambling is booming in India, where 73% of respondents to a 2021 YouGov survey stated they preferred playing online rather than in a brick-and-mortar casino.
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When online gambling markets grow as rapidly as the Indian market is right now, dozens of local and international companies move in to take advantage of the opportunity.
Luckily, Indian players have an integrated national network of financial institutions to rely on. The National Payments Corporation of India (NPCI) provides infrastructure for the country’s banking system. Unified Payments Interface (UPI) integrates multiple bank accounts and features into a single mobile application; the Bharat Interface for Money (BHIM) app uses UPI for fast, easy transactions.
The most popular payment method in India is PhonePe, an app that allows users to make quick, secure payments using BHIM UPI, credit cards, debit cards, or e-wallets. Equally popular in India is PayTM, which claims about 25 million registered users. In addition to e-commerce, the service covers financial transactions using electronic wallets and mobile payments.
India:
- PhonePe;
- BHIM UPI;
- PayTM.
Africa
Like the rest of the continent’s economic development, the iGaming market in Africa is developing along its path.
Formal bank accounts are a rarity in Africa, and credit cards are even more so. Instead, African players use mobile banking, a trend that is growing at a faster rate throughout the continent than the global average.
For example, M-Pesa, a method of a money transfer using a mobile phone, is widely used in Kenya, where 58% of the adult population has a mobile account. M-Pesa is also common in neighboring Tanzania, and in both countries, the service is the favored option for sports bettors.
Nigeria’s booming sports betting market is facilitated by the country’s multiple payment gateways.
Lagos-based payment processor Interswitch connects a number of Nigerian banks. GTBank, one of Nigeria’s leading banks, created payment gateway GTPay to enable seamless payments for debit cards issued by banks participating in the Interswitch network.
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Flutterwave’s RAVE is one of the country’s fastest-growing gateways. The online payment solution makes collecting online payments for businesses and individuals simple, safe, and secure for their customers.
Africa:
- M-Pesa;
- GTPay;
- RAVE.
Canada
Interac is easily one of the most popular payment systems in Canada. Interac was founded in 1984 and launched its e-transfer service in 1996. The service’s long history has given it plenty of time to establish itself, and its nationwide coverage has led almost 60% of the country’s nearly 40 million people to use the service. PayPal, in comparison, has just over 6 million Canadian users. Solution provider Gigadat, which uses the Interac system, is one of the most widely used payment methods for online casinos in the country.
Canada:
- Interac;
- Gigadat.
Southeast Asia
Asia is home to some of the world’s largest economies and most coveted gambling markets.
E-wallets are the most common choice for online casino players and sports bettors in the region, followed by credit cards, debit cards, and bank transfers. Founded in 2003, payment processor 2C2P has become one of the largest payment systems in Asia, partially because it even accepts payments from customers without a credit card.
Thaiepay provides payment solutions for e-commerce in Thailand, allowing operators to accept payments using Visa, MasterCard, and American Express cards. PaysBuy, another leading processor in the country, makes it easy to make and accept online payments. In principle, PaysBuy is similar to PayPal; sellers can accept payment by Visa, MasterCard, or from local bank accounts on their websites. Cryptocurrency payments are also prevalent in southeast Asia.
Asia:
- 2C2P;
- Thaiepay;
- Paysbuy.
Cryptocurrency
The blockchain revolution has long been underway. Attracted by anonymity and decentralization, players are increasingly expecting to make payments using cryptocurrencies — in fact, some online casinos conduct transactions exclusively in crypto. More and more players are coming to expect to make payments in cryptocurrencies like Bitcoin and Litecoin.
Online casinos and sportsbooks need to consider both local regulations and the resources players have at hand when they enter a new market. If your platform does not support a player’s preferred method of making deposits and withdrawals, nothing stops them from ditching your platform for one that caters to their needs.
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