Online Casino Payment Gateway
The online casino industry is lucrative and rapidly growing but still categorised as high-risk and therefore often rejected by payment service providers. If you find yourself struggling to add more payment options for the customers of your online casino business, it only suggests you haven’t yet looked at the high-risk payment service providers who offer high-risk payment gateways to online casino businesses.
A payment gateway is a client-facing type of software supplied by payment service providers, which enables merchants to verify credit and debit cards or other types of online payment methods in a safe and secure way. In an online store, this is the section where a customer is asked to select a payment method (credit or debit card, crypto wallet or e-wallet, etc.) and enter the payment information.
An online casino payment gateway is categorised as a high-risk payment gateway due to the legal restrictions, susceptibility to money laundering and inherent financial and reputational risks the industry can pose to merchant acquiring banks and payment service providers. The vast majority of regular providers won’t accept such businesses as clients due to the preset organisational policies in spite of the financial opportunity which is why you should pay special attention to those prepared to cater to the needs of high-risk businesses.
The right high-risk payment gateway provider will be adept at dealing with the following challenges of your online casino business:
- A robust regulatory framework of the gambling industry that makes your business subject to stricter than usual payment requirements
- An increased risk of money laundering and other types of financial crime places the gateway providers under the obligation to implement know-your-customer (KYC) procedures
- The high volume turnover of your website which makes it difficult to monitor and audit
- A high-traffic website hinders thorough monitoring and audit of transactions which exposes the business to illegal activities
- High volumes of chargebacks are often caused by friendly fraud attempts and therefore bring financial losses to business and payment service providers alike
The integration of a cutting-edge, well-designed and reliable payment gateway will make the payments too effortless and too convenient to be abandoned which will certainly lead to the expansion of your customer base.
Key functions of an online casino payment gateway:
- Help you fit into the regulatory framework of online gambling
- Securely move money between your merchant account and customers
- Facilitate convenient payment methods which will likely increase your sales conversion and customer retention rates
- Ensure seamless processing of payments
The following parties are involved in the payment process:
- A merchant (in this case, your online casino business)
- Your online casino customers
- A merchant acquiring bank that maintains your merchant account
- A payment gateway that safeguards payment details and authorises payments
- A payment processor designed to process an authorised payment
- An issuing bank which is a bank of your customer
- It can also be a crypto wallet provider or other money storage provider
How the payment gateway facilitates the authorisation of a payment:
- When your customer clicks “Deposit” on your online casino website, they’re taken to the page of payment options
- Your customer selects a payment option and enters their payment details at the payment gateway of your online casino website
- The payment gateway validates the customer’s data, as well as verifies the availability of the customer’s funds
- The payment gateway encrypts the customer’s data and sends it to the payment processor of your merchant acquiring bank
- The merchant acquiring bank sends the information to the customer’s card association (or crypto wallet, or other money storage) to approve the transaction
- The customer’s card association either authorises or rejects the transaction and sends this data back to your merchant acquiring bank
- Your merchant acquiring bank sends the payment authorisation data to the payment gateway
- If the payment is approved, it gets transferred to your corporate bank account by the merchant acquiring bank
All European payment service providers must adhere to the Payment Services Directive (PSD), the purpose of which is to encourage competition and enhance safety within the digital payments market. Moreover, every payment service provider operating in Europe must be fully licensed by relevant state authorities, which means the payments made to the accounts of your online casino business will be well-managed and protected from fraud. If you’re not sure about European licensing, feel free to seek a personalised consultation with our legal experts here at IB-IA GROUP UAB.
Keep in mind that your customers are willing to entrust their money to you, and they certainly don’t expect to face insecure payment and withdrawal issues. Any failure to meet these expectations will lead to the loss of trust and eventually revenue.
