The fact that in many markets over 90% of bets are already being placed on the smartphone shows that the modern sports betting industry can no longer get by without an online- / mobile-first approach. One of the greatest challenges in this context, however, is the flow of money. Because only when smooth and reliable payment processes can be guaranteed are players usually ready to bet with a provider.
The following article deals with current trends around the topic of online payment methods in the sports betting business.
Due to the steady growth of the online sports betting sector and the increasingly younger demographics of betting customers, the demand for online payment methods for iGaming platforms has increased enormously in recent years.
In order to enable customers to deposit money online on a betting platform, a cooperation with payment service providers is usually required. Customers can use their offered payment methods to deposit and withdraw money via debit or credit card, prepaid tickets or digital wallets (e.g. PayPal, ecoPayz, Skrill, …).
At the same time, there is also increasing pressure to provide seamless user experiences in the area of onboarding and transactions – because the more complicated and tedious these steps are, the higher the likelihood of losing potential customers. Betting providers should therefore focus on simplifying these crucial processes as much as possible.
On the other hand, there is also the risk factor of online payments. It is estimated that around every 23rd online payment transaction raises suspicion of fraud, which forces both payment providers and betting companies to use strict security measures. Techniques such as fingerprinting devices, tracking the transaction history of the device used, and tools for detecting suspicious transactions help identify such risks at an early stage.
The right payment methods
The right choice of payment methods is highly relevant for betting providers when it comes to gaining new customers. This depends primarily on the payment habits in the respective market, but also on the availability of payment providers.
An appropriate selection of means of payment has several advantages:
On the one hand, a selection tailored to the payment habits of the respective target market leads to more deposits, as the deposit barrier (as it occurs, for example, with unknown means of payment) for customers is lowered. The easiest way to assess the payment habits in a market is to analyze the competition in that market. What payment methods do other companies offer in your target market? Do customers in your market primarily pay with credit cards or do they prefer methods such as Paypal, Boleto or prepaid systems?
On the other hand, the offer of well-known payment methods such as Visa, Mastercard or Paypal leads to a higher level of trustworthiness as a provider. To put it simply, it can be said that nobody bets with a provider where they cannot easily deposit using known payment methods. The selection of known means of payment is an important quality feature for customers and is particularly relevant when acquiring new customers.
The availability of most payment providers these days is tied to strict compliance guidelines and the existence of a valid sports betting license and represents one of the greatest challenges for new and existing sports betting providers.
Due to the reputation of the industry, the risk of money laundering and fraud, as well as the high chargeback rates, and potential legal problems, sports betting companies are classified as high-risk by payment providers. As a result, not all common payment service providers accept betting companies as customers or they require account types that are designed for high-risk companies in order to be able to process and accept their payments.
For this reason, it is advisable for betting companies to also offer alternative payment methods on their platform. These are, for example, wallet solutions such as Paysafe, Boleto, Neteller or Ecopayz, which are becoming increasingly popular in cross-border businesses such as online gambling and online sports betting.
Such solutions can therefore be used effectively to increase the traffic on a betting platform, as they offer additional options for deposits and withdrawals and many players are already familiar with their use.
A provider who provides companies in the iGaming industry with a wide range of online payment methods is Apcopay, for example.
Arland’s iGaming software Bookmaker NEXT offers a large number of already integrated payment providers and methods for a wide variety of markets, which allow rapid market entry. In addition, it is always possible to integrate new payment providers!
The Arland experts will be happy to advise you on payment options for your company. Simply write to us at [email protected].